UK Business Secretary Vince Cable has stepped in the housing price debate by calling for action to be taken to stop a property boom which he claims is getting out of control in parts of the UK.

He said he was appalled that some banks are lending five times a mortgage applicant’s income. He believes that a more ‘stable’ level would be up to 3.5 times salary, adding that the desires of potential home owners should be balanced against the stability of the economy.

His interventions comes hours before Chancellor George Osborne is expected to mention how the Bank of England could tackle any financial instability caused by house price rises.

But many in the property industry are surprised at comments. Just last week the latest index from the Nationwide Building Society said the signs point to activity in the UK housing market starting to moderate.

And today the latest report from the Royal Institution of Chartered Surveyors (RICS) said that the momentum was starting to slow in the housing market, as a lack of supply, higher prices, and more prudent lending measures are making buyers and sellers more cautious.

Many experts point to the fact that most of the house price growth has been in London where overseas buyers have been fuelling the market. But even that is slowing with the latest analysis reports pointing out that price growth in the city is slowing and there are predictions of 0% growth in the near term.

When pressed Cable admitted that the boom in prices is confined to the south east of England but he still said that banks are throwing ‘petrol on the fire’ by giving home loans that ran at high multiples of applicants’ incomes.

Paul Smith, chief executive officer of haart estate agent, believes such a move would strangle the recovery in the property market. ‘It’s not clear why Vince Cable wants to kill off first time buyers, vastly reducing their ability to get a mortgage and strangling the current housing market recovery,’ he said.

‘Indeed his proposals would also hold current home owners hostage in their own homes, as they will not meet the lending criteria when they chose to move on and need a bigger mortgage,’ he explained.

He added that such a proposal would also affect house builders as there would be no encouragement to build homes if buyers can’t get mortgages.

‘The whole point of a mortgage is to help those who aren’t lucky enough to make a cash purchase and that’s the majority of the UK’s aspiring home owners which ever rung they are on,’ said Smith.

The head of research at property firm Hamptons International, Johnny Morris, said it was too early to call for caps on income multiples. ‘First we need to see the impact of stricter affordability rules recently introduced through the Mortgage Market Review. Lenders are already aware of the risks associated with deteriorating affordability and the increased vulnerability of highly geared borrowers,’ he pointed out.

‘The numbers of mortgage…

Stringent lending has led to a fifth consecutive monthly decline in housing supply coinciding with a levelling off of new buyer demand, according to the latest report from the Royal Institution of Chartered Surveyors (RICS).

There are too few properties coming onto the market and in London, where fears of an overheating market have been expressed, demand for new homes fell for the first time since June 2012.

In May when UK house prices reach record levels of £186,512 and greater lending restrictions begin to impact the market, respondents reported that banks are lending less, with the average Loan to Value (LTV) ratios among first time buyers dropping to 85.3% from 86% in April.

Meanwhile, respondents’ expectations for house prices over the next 12 months dropped from 3.9% to 3.6%, the lowest since December 2013.

Although more modest expectations for growth in activity are visible in London, there are some early signs that concerns over both supply and finance could be influencing prospects elsewhere in the country.

For example, sales expectations over the next three months in the South East show a net balance of 29% of chartered surveyors expect greater market activity and a net balance of 48% in the South West, down from 66% and 93% respectively six months ago.

The tightening in lending conditions facing some parts of the housing market even led to a modest pick up in demand in the rental sector and rent prices are now projected to grow at around 2.5% over the next 12 months, and at an average annual rate of 4% over the next five years.

‘What we are really seeing is some of the very strong upward momentum starting to come off the housing market, as a lack of supply, higher prices, more prudent lending measures and some of the talk from the Bank of England are creating a level of caution among sellers and buyers,’ said Simon Rubinsohn, RICS chief economist.

‘The most visible indicators of this are the revised downwards price expectations for the next 12 months and the flatter picture regarding new buyer enquiries. In particular, we’re seeing the London market level off,’ he explained.

‘There is some evidence to suggest that the Mortgage Market Review (MMR) has contributed to a tightening of the funding market, although it is hard to disentangle this from other factors which are now impacting on the sector and to know whether it will simply be a temporary influence as lenders adjust to the new environment,’ he added.

But the latest report and data from the Council of Mortgage Lenders suggests that MMR has not dented the lending market with loans up in terms of numbers and values.

First time buyers and home movers continue to be key drivers in the growth of the UK mortgage market despite fears that new regulations might slow things down, according to the latest report from the Council of Mortgage Lenders.

The data from the CML shows that the number of loans to first time buyers rose by 1% in April compared to March, but was 37% higher than in April 2013. By value, lending to first time buyers was up 3% on March and 52% higher than in April last year.

The number of loans to home movers increased in April by 11%, with the value up 15% compared to March. Compared with April 2013, growth was up 30% by volume and 47% in value.

Total number of loans for home owner house purchase, first time buyers and home movers, increased month on month by 6% and 11% by value on March, with year on year growth in number of loans up 33% and 47% by value. Total number of loans for remortgage in April was up 6% and 11% by value compared to March.

The data also shows that total number of buy to let loans declined slightly month on month down 1% in April but the value remained unchanged. Compared to April 2013, there was a 43% increase in number of loans and a 57% increase in overall value.

Home-owner house purchase lending in April increased month on month as lending continued to recover from the usual seasonal dip seen at the beginning of the year. In total, 53,200 loans were advanced for house purchase, up 6% compared to March, and the value of these loans totalled £8.8 billion, a rise of 11% on March.

Compared to April 2013, the number of loans increased by 33% and the value of lending by 47%. First time buyers took out 24,500 loans in April, up only slightly by 1% compared to March but 37% more than in April 2013. The total value of these loans was £3.5 billion, which was up 3% on March and 52% on April last year.

First time buyer affordability worsened fractionally, with first time buyers typically borrowing 3.42 times their gross income, compared to 3.41 in March. The typical loan size for first time buyers was £121,500 in April, up from £118,750 in March and represents the highest monthly average advance for first time buyers on record. In parallel to this, the typical income of a first time buyer household increased to £37,000, up from £35,704 in March, which was also the highest average income on record.

The relatively low level of interest rates means borrowers’ payment burden remains relatively low at 19.4% of gross income being spent to cover capital and interest payments, up from 19.2% in March and 19.1% in April 2013.

The number of loans advanced to home movers for house purchase totalled 28,700 in April, up 11% compared to…

Scotland’s commercial property market is set to boom in the wake of the referendum, irrespective of the outcome of the vote, according to a new report.

Pent-up investment demand would be released at the traditionally busy end of year, as current market uncertainty is removed, says the analysis from global commercial real estate services firm Colliers International.

A Yes vote could see a surge in occupier demand from professional services groups involved in the subsequent independence negotiations and implementation,’ it adds.

However, the Colliers International referendum report paints a less optimistic picture of the medium term prospects of the property investment market.

Polling 150 occupiers and property investors with UK wide interests, the survey results suggest that the investment market is likely to suffer, with respondents attaching a considerable risk premium in the case of a Yes vote.

According to the survey, the average response suggests it could take some 4.5 years for inward property investment to return to traditional levels and that property investment yields would need to rise by an average of 160 basis points to compensate investors for increased risks during the period of normalisation, following an independence vote.

‘Individuals must make up their own minds as to how they should vote on 18 September. However, based on the feedback of some 150 real estate professionals, it is clear that the lack of certainty is creating anxieties in this important part of the economy,’ said Walter Boettcher, director of research and forecasting at Colliers International.

‘While the Scottish Government’s Scotland’s Future proposal has suggested it will take a decidedly ambitious 18 months to put in place the necessary institutions, treaty revisions and a constitution, the survey suggests that confidence in the property sector is likely to take significantly longer to restore. Only 13% of our respondents expect the current volatility and uncertainty to disappear within two years, given a Yes vote,’ he explained.

‘The debate so far has been un-illuminating, founded as it is on what ifs and scenarios that are only partially understood. This is reflected in split survey opinions as to whether an independent Scotland would be a higher risk investment than the Eurozone periphery. Some 51% believe that an independent Scotland would be a riskier investment than these peripherals,’ he pointed out.

‘While this may reflect the risk-averse nature of property professionals in the survey, who invest on behalf of pension funds and other risk averse organisations, it may also highlight lingering concerns over the possible lack of a powerful monetary backstop, such as the European Central Bank or the Bank of England,’ he added.

He also pointed out that some 49% of the sample felt the risks would be either similar or less risky than the Eurozone periphery.

Tom Johnston, head of retail for Scotland and head of Glasgow with Colliers International, suggested that the survey highlights the need for a stable environment that enables companies to plan for the future.

‘The reality of a Yes vote would, undoubtedly, lead to a…

Plans to build new holiday homes in four locations around Lake Annecy in the foothills of the French Alps have been hailed as a landmark achievement as the area has strict planning controls.

Winning planning permission for the 37 new homes in such an environmentally protected location is put down to a sensitive approach, according to developers MGM French Properties.

‘MGM’s enviable reputation as a leading developer of residential schemes throughout the French Alps played a key role in achieving local approval,’ said Richard Deans who heads the firm’s London based UK sales office.

Although development opportunities in the Annecy area are rare, MGM has identified and secured many of the best locations in recent years, thanks to the strength of its business and a reputation for high caliber schemes spanning 50 years.

The firm has been welcomed by the area’s local authorities which, during the past 16 years, have applied stringent new requirements to planning applications, paying close attention to the style, finishes and overall quality of the architecture.

All of MGM’s planned new developments will combine contemporary designs with traditional architectural styles. Two will be in the historic lakeside town of Annecy and the others are in villages on the shore of the lake, said to be the cleanest in Europe.

‘These are small schemes of a type which I believe will have a special appeal for British buyers, particularly those who enjoy sailing and skiing, both of which are on the doorstep,’ explained Deans.

The smallest of the developments, La Villa Méïa, will comprise just four apartments within Annecy’s so-called golden triangle, the peaceful pedestrianised heart of the town with its cobbled streets and little Venice canal network. La Villa Méïa will be close to the Annecy store of Galeries Lafayette and just a few minutes’ walk from the waterfront.

Nearby Villa Lisa will contain 18 apartments in an established residential area currently being redeveloped. Close to the town centre, the new apartments will be 10 minutes’ walk from the lakeside promenade and parks.

The two villages in which MGM plans to build, both on the west side of the lake, are linked to Annecy by water taxis, a lakeside cycle path and local bus services. One is Sevrier, a village 10 minutes from Annecy by car with a sun bathing lawn on its waterfront and a boating pontoon with moorings available. Some 500 metres from the lake, Villa Opale will contain seven apartments, each with a garage, parking space and bike lock-up.

Further down the lake at Villa Emeraude in the centre of family friendly St Jorioz, 10 kilometres from Annecy, will be eight new apartments in a peaceful village setting. This part of the lake is popular for swimming.

In surveys, Annecy consistently features as one of the most desirable places to live in France. Flower filled in summer, the town is a cultural centre hosting festivals, conferences, exhibitions and theatrical performances throughout the year.

‘For investors, there is good scope for long term or short term…

People buying a leasehold property in the UK are being warned about the wide variation in fees that can be charged by management companies and landlords.

There is a lack of consistency from leasehold landlords and no industry standard which means they can, and do, charge whatever they want, according to conveyancing services firm myhomemove.

It is calling for greater consistency and clarity from management companies and landlords in relation to the charges they levy at clients who are buying a leasehold property.

In 2013, myhomemove managed 8,246 leasehold transactions, 24% of which were for first time buyers. Analysing this data has revealed that there are vast discrepancies between the amounts charged by management companies and landlords for services including Notice of Transfer, Notice of Charge, Deed of Covenant, Stock Transfer and Application.

Currently leasehold clients can be charged anywhere from 10 pence to over £1000 and Doug Crawford, chief executive officer of myhomemove said there should be an overall standard for the industry.

‘In this day and age it seems incredible that there is no industry standard for management companies and landlords, meaning they have carte blanche to charge leasehold home buyers whatever they want,’ he explained.

‘Over a third of our leasehold clients are charged between £100 and £200 by landlords and management companies, while the really unfortunate ones must pay between £500 and £1000. These fees are in addition to their moving costs, ground rent and insurance,’ he added.

Last year the number of first time buyers rocketed by 37%, while the number of buy to let investors also increased by 19% with a large proportion investing in leasehold properties such as flats and apartments, especially in boom areas such as London and the South East.

‘We appreciate that services cost money, but when a client is left baffled as to the amount they must pay and why, it seems very unfair; especially as they cannot purchase the property without paying these charges and they have no way of shopping around for a better deal,’ said Crawford.

Five designs for a new garden city in the UK have been shortlisted for a major prize at a time when the country could see up to three new towns built.

The government has pledged to reform the planning system so that new garden cities can be built and one site at Ebbsfleet in Kent has already been identified.

The 2014 Wolfson Economics Prize, the second most lucrative economics awards after the Nobel Prize, asked entrants to design a visionary and economic garden city and received almost 300 entries from all over the world.

Now it has announced the shortlist of five finalists and revealed that a new poll shows that 74% of people believe garden cities are a good way to meet Britain’s need for more housing.

The five shortlisted designs, which were judged anonymously, are made up of entries from planning consultants Barton Willmore, housing development expert Chris Blundell, urban design specialists URBED, housing charity Shelter and planning company Wei Yang & Partners.

Miles Gibson, director of the Wolfson Economics Prize, said that if all five of the proposed garden cities were built, they would provide homes for 400,000 people and construction jobs for 400,000 workers.

‘There are opportunities to improve the quality of people’s lives by building garden cities, rather than tacking 50 odd houses here and 100 houses there on to the end of an existing settlement,’ he said.
‘We can’t continue shutting people up in what are the smallest homes in Europe at just 76 square metres. People are entitled to aspire to better quality housing for themselves and that does include a reasonable amount of outdoor space,’ he added.

Gibson explained that a garden city must be green and have plenty of open space. ‘It has to be a mixed use place with jobs and offices and retail facilities to create a community. It needs to be well connected to the existing transport network but not necessarily so well connected that it becomes a commuter town. It’s got to have a life and an identity and a community of its own,’ he pointed out.

‘We haven’t done garden cities in the UK for 100 years and we haven’t done new towns in the UK for 40 years, so there’s no doubt there’s a skill and collective memory issue that would have to be addressed if any of these were actually to be built,’ added Gibson.

‘Nobody is expecting anything overnight and this takes careful planning. We hope that what the prize has done is make people feel it is possible. Our entrants all argue that this can be done and what it needs is a national political consensus that it should be done and then it will happen,’ he said.

Campbell Robb, chief executive of Shelter, whose shortlisted design proposes a development at Stoke Harbour that could eventually accommodate 150,000 people, said that creating new garden cities is an essential step towards building the homes we need.

‘From families struggling to keep up with their…

Fewer rich foreign buyers are seeking to invest in safe haven properties in London with the latest analysis showing a rise in British buyers for prime real estate in the centre of the city.

UK buyers have accounted for 53% of the market since the start of the year, up from 36% last year and 27% in 2012, according to the research from international property firm Knight Frank.

The combined figure for UK and European buyers is 79% this year compared to 46% in 2013, a notable increase that the firm says underlines how sustainable demand remains for super prime property.

The report also shows that average annual price growth across prime central London in the year to April slowed to 7.5%, but the figure is noticeably lower in the higher price brackets. Annual growth for £10 million plus properties was 3.3% and this moderation in the rate of growth comes as buyers increasingly seek value beyond the popular postcodes’ of Mayfair, Knightsbridge and Belgravia and vendors become more realistic on pricing.

The firm’s analysis of the super prime property prices shows that they grew strongly in the immediate fallout of the financial crisis and to some extent the rest of prime central London is now catching up, helping to explain the divergence in performance between the £10 million plus market and the rest of the prime London market.

British buyers are increasingly stepping into the place of foreign buyers as threats like the collapse of the euro zone diminish at a time when the UK economy improving. It means that there are now more British buyers in the super prime bracket than at any time since the collapse of Lehman Brothers.

Transaction levels have jumped markedly. There was a 54% increase in the number of £10 million plus deals done in the 12 months to the end of April compared to the previous year.

However, the report also says that while economic conditions are more benign, the political backdrop has become more unpredictable. In the UK, a series of tax changes for residential property have been announced. While individual changes will not generally deter buyers at the super-prime level, they lead to a mood of uncertainty and rising political rhetoric that is likely to dampen price growth in the run up to the UK general election in May 2015.

At the same time, instability in emerging markets, triggered by events such as the conflict in Ukraine or China’s economic slowdown, could spark a second wave of ‘safe haven’ capital into the super-prime London market and put upwards pressure on prices.

What buyers of all nationalities have in common is less loyalty to the golden postcodes of Mayfair, Knightsbridge and Belgravia. In 2013, 51% of super prime deals were in one of those three districts compared to 26% so far in 2014.
Areas such as Marylebone and Hyde Park are becoming firmly established on London’s super prime map as buyers seek more square feet for their money and developers…

Planning permission for new homes in the UK is at its highest level since 2008 but the system needs to deliver more sites more quickly to meet demand, according to new figures from the House Builders Federation.

The figures show that 177,731 permission were granted in the year to the end of the first quarter of 2014 with 43,926 in the first three months of the year alone.

The HBF said that with all indicators now showing big increases in house building activity, largely as a result of increased sales driven by the Help to Buy equity loan scheme, it is vital the number of applications granted continues to rise.

The report, produced for HBF by Glenigan, also demonstrates why the government needs to focus its attention on the planning system if there is to be a continued increases in house building.

It points out that the number of sites consented has actually dropped to 679 from 885 in the fourth quarter of 2013 and 807 in the same quarter last year. The report says that if the house building industry is going to be able to move to the next level, and raise build rates still further in the years to come, increasing the number of sites on which they are building and selling homes is absolutely key.

The house building process means that large sites can only be built and sold at the prevailing market rate for that site. It is, therefore vital that we see an increase in the number of sites granted permission if we are to sustain a continuation of the positive indicators of future expansion in house building.

Speeding up the rate at which permissions are granted will also be key to significant, sustainable increases. Too many sites are ‘stuck’ in the planning system, with an estimated 150,000 plots at ‘outline permission’ stage awaiting full sign off by local authorities.

The industry is imploring local authorities to ensure their planning departments are sufficiently resourced, and applications are processed efficiently and speedily, so that work can get started on new sites.

In its Autumn Statement the government committed to introducing legislation to remove blockages in the planning system by imposing a limit on the ‘pre construction’ conditions that planning authorities could put on permissions, and a time limit on discharging them. These proposals now urgently need implementing if housing supply is to continue to increase.

‘All political parties and commentators now agree we are facing an acute housing crisis that will only be solved by building substantially more homes. The Help to Buy Equity Loan scheme has led to a big increase in sales of new homes and the industry has responded and significantly increased output,’ said Stewart Baseley, executive chairman of the HBF.

‘Existing sites are being built out quicker and we now desperately need new sites to come on stream if we are to see increases in house building sustained. All builders are now identifying the planning system as the…

Lending for new home building is continuing to rise in Australia, up 5.4% in April to reach the highest quarterly level since early 2010, according to the latest data from the Australian Bureau of Statistics.

Overall the profile for housing finance is a positive one for residential construction activity in coming quarters, said the Housing Industry Association, the voice of Australia’s residential building industry.

Over the three months to April 2014 HIA’s seasonally adjusted estimate shows an increase in the number of loans for new housing in New South Wales of 1.1%, a rise of 5% in Victoria, a rise of 5.5% in Queensland, a rise of 7.5% in South Australia, a rise of 6.9% in Western Australia and a rise of 10.7% in Tasmania.

But levels fell considerably in the Northern Territory and in the Australian Capital Territory. The number of new housing loans fell by 31.8% and 40% respectively.

Meanwhile, preliminary ABS figures show strong growth in residential building activity in the March 2014 quarter. There was over $13 billion of residential building work done in the March 2014 quarter, a 6.8% increase over the previous quarter and a level 8.4% higher than the March quarter a year ago.

‘Dwelling approvals activity was particularly strong in the final quarter of 2013, so it is natural that we now see an improvement in the level of building work being done. The figures are the first official statistics confirming that the strong leading indicators that we saw late last year are flowing through to strong levels of residential building activity on the ground,’ said HIA economist, Geordan Murray.

‘Aside from a single quarter in 2010 when activity surged in response to fiscal stimulus during the financial crisis, the March 2014 quarter was the highest level of residential building work done in any other quarter on record,’ he explained.

He also pointed out that the value of work done on multi-unit dwellings reached a new high in the March 2014 quarter, this is consistent with the indications from housing approvals data. The jump in the value of work done on multi-unit dwellings was the strongest driver of the overall improvement in activity, accounting for around two thirds of the growth in the quarter.

‘It is encouraging to see work done on detached homes posting strong gains. Also, a second consecutive quarterly improvement in the amount of work done on home renovations is a positive sign for this part of the industry after activity dropped to decade lows in 2013,’ added Murray.

The value of work done on new detached homes increased by 4.7% in the March quarter of 2014 to a level that is 2.4% higher than that of a year earlier. The value of work done on multi-unit construction increased by 12.7% in the March quarter of 2014 to a level 19.6% above the level recorded in the March quarter of 2013.

The value of work done on renovations increased by 0.7% in the March…

UK Housing Minister Kris Hopkins has launched new How to Rent guide for private rented sector tenants in the country as part of a wider crackdown on rogue landlords.

The aim is to give private rented sector tenants the need to know rental rights at their fingertips, thus encouraging a new generation of well-informed tenants with easy access to useful and understandable information.

The launch comes as the government confirmed plans to require all letting agents to publish a full tariff of their fees both on their websites and prominently in their offices. Anyone who does not comply with these new rules will face a much stricter penalty than currently exists.

Hopkins said it is part of the government’s wider work to bring clarity and fairness to the system and ensure that England’s nine million private rented sector tenants have the knowledge to hold their landlord to account, without introducing excessive regulation which would force up rents and reduce choice.

And this is on top of additional measures being brought forward to provide magistrates’ courts with the power to impose unlimited fines on landlords found guilty of not meeting their responsibilities, such as failing to carry out essential improvement works to a property or continuing to rent out a property which the council has ruled is not fit for habitation.

The guide includes advice and information on tenancy deposit schemes, bill payments and tenancy length, a checklist of what the landlord must provide tenants, including gas certificate and deposit paperwork, information on the requirements of the landlord to maintain the structure of the property and give tenants at least 24 hours’ notice before entering the property and the legal requirements for landlords and tenants on ending tenancies and returning deposits.

‘This government is turning up the heat on the small minority of rogue landlords that are not playing by the rules and giving tenants a rough deal. The new guide will give tenants the knowledge they need at their fingertips and help raise the game of landlords who may not know what is expected of them,’ said Hopkins.

‘We are doing all of this without the need for excessive state regulation that would destroy investment in new housing, push up prices and make it far harder for people to find a flat or house to rent. The private rental sector is vital asset to the country and this government is determined to get Britain building and boost investment in the sector,’ he added.

He also pointed out that the government has already introduced new legislation which will require all letting and managing agents in England to belong to an approved redress scheme ensuring tenants and leaseholders have a straightforward option to hold their agents to account.

Other measures in the pipeline include a new code to set standards for the management of property in the private rented sector with a view to making it statutory and the introduction of a voluntary, model tenancy agreement, which landlords and tenants can use…

Mortgage lenders in the UK have successfully met a commitment they gave a year ago to contact their borrowers with interest only mortgages, according to the Council of Mortgage Lenders.

The commitment, given by mortgage lenders to the Financial Conduct Authority, was to contact interest only borrowers whose mortgages are due to mature by the end of 2020 about how they plan to repay their loans.

The CML and lenders nevertheless recognise that meeting this commitment is only the first part of an ongoing programme of communication with interest only mortgage customers.

The CML surveyed members on their communications, and found that those borrowers who should have been contacted have been. The only notable exceptions in the communication programme were those with very small balances where there is little material risk, and those with whom lenders were already in contact.

Lenders have been using a variety of contact strategies. In addition to reminders and mailings requesting the customer’s written response, including questionnaire responses, telephone calls, face to face meetings and even home visits are also used by some lenders. Overall, around 30% of customers contacted have so far responded.

Although the CML does not have a comprehensive picture yet of the most successful contact strategies, overall it seems those that include a specific call to action on the part of the customer generate higher response rates.

Among those borrowers who have responded, around four out of five already had a clear plan. Among those who did not, the survey found that the solutions and approaches lenders are offering typically include term extensions, permanent conversions to capital and interest, and overpayments.

Looking ahead, lenders will build on the experience they have gained over the past year to refine their contact strategies, continue to seek responses from borrowers who have not yet communicated with them, and gain further insight into which methods are most effective in encouraging their borrowers to respond. The CML will undertake further follow up surveys in due course to help lenders with this work.

The latest findings sit alongside research that the CML published earlier this year showing a significant fall over the past year in both the number and the value of interest-only mortgages. It is encouraging that people are clearly beginning to act positively to take steps to manage their interest-only mortgages.

‘We are pleased to report that lenders have met their initial commitment to contact interest-only borrowers whose mortgages are due to mature by the end of 2020. But we all recognise that this is just the start of a long term, continuous communication programme,’ said CML director general Paul Smee.

‘So far, around 30% of customers who have interest-only mortgages maturing by 2020 have responded to their lender on their repayment plans. This is an encouraging start, but also highlights the challenges of achieving effective two-way communication,’ he pointed out.

‘If you have an interest-only mortgage due to end before the end of 2020 and you have not yet responded, it is…

The prime residential market across Scotland has outperformed the overall Scottish market, with the highest level of activity since 2007, according to a new analysis.

Prime transactions, that is for properties sold for £400,000 and above, across Scotland increased annually by 32% during the year ending March 2014 compared to 20% for the overall market.

The analysis from real estate company Savills says that such strong sales are being driven by the hubs of Edinburgh, the Aberdeen area and Greater Glasgow.

The Tayside region, which includes the counties of Angus, Perthshire and Kinross, has benefited from the strength of the Aberdeen market, with a 36% annual increase in sales as well as a return to closing dates.

Around 20% of Savills buyers across Tayside in the last 18 months came from the Aberdeen area, with a further 45% coming from other parts of Scotland and the rest of the UK, thus highlighting the popularity of the Tayside region as an attractive area for relocation.

There was also a jump in transactions at the top end of the market above £1 million in Scotland, with 144 sales recorded in the year ending March 2014, including nine in Tayside with buyers coming from as far afield as South Africa.

Prime values across Scotland are rising, especially in the hotspots of Edinburgh and Glasgow due to the reduction in stock following the rise in prime sales. The rebalancing of supply and demand has begun in the country locations including Tayside where values have stabilised. The prime Tayside market is being led by the lower end of the market up to £500,000 where values have increased. The upper end of the regional country house market remains challenging as there is currently a high supply of stock at this level.

The number of mainstream sales across Scotland increased annually by 20% during the year ending March 2014, mainly driven by an increase in mortgage lending. Mainstream values across Scotland as a whole increased annually by 8% during the first three months of this year, which reflects the confidence returning to the market.

Within Tayside, the market in Angus has had a strong year with a 33% annual increase in transactions. The market in Perth and Kinross is consistent with the rest of Scotland in terms of activity. Residential activity in the cities of Dundee and Perth also increased, however the markets in these areas are still lagging the rest of Tayside and Scotland as whole.

Meanwhile, the Scottish Government has published new figures showing significant growth in the Scottish property sector over the last year. The figures show that the cash value of residential sales has risen from 22.2% between 2012/2013 and 2013/2014 and that sales volumes in 2013/2014 are the highest since 2007/2008.

‘These figures are extremely encouraging, especially when viewed alongside the wider indicators of strength in the Scottish economy, where Scotland is outperforming the UK on employment, unemployment and economic activity,’ said Enterprise Minister Fergus Ewing.

‘Inward investment in Scotland as a whole…

Residential real estate prices in 20 key American cities increased at a slower pace in the year to the end of March as the housing market began to weaken at the start of 2014.

According to the S&P/Case-Shiller index property values increased 12.4% from March 2013, the smallest 12 month gain since July, after rising 12.9% in the year that ended in February.

Tight lending standards and a rise in mortgage rates since the middle of 2013 have slowed demand, limiting the ability of sellers to keep asking even higher prices. An increased availability of cheaper properties, faster job and income growth, and a sustained drop in borrowing costs this year would help draw more buyers into the market.

‘The upward trajectory of prices remains in place, but with a slower rate of appreciation,’ said Michael Gapen, senior US economist at Barclays Capital in New York.

‘There’s still reason to suspect that home prices will rise as credit availability on the margin, is actually getting better, labour market progress is gaining strength and average income is improving,’ he said.

Prices covering all of the US climbed 10.3% in the first quarter from the same period in 2013, down from an 11.4% year on year gain in last year’s fourth quarter, which was the biggest increase since the first quarter of 2006.

Home prices adjusted for seasonal variations increased 1.2% in March from the prior month while unadjusted prices rose 0.9%.

All 20 cities in the index showed a year on year gain, led by a 21.2% rise in Las Vegas and a 20.9% increase in San Francisco. Cleveland showed the smallest year on year increase, with prices rising 3.9%.

Home sales have been slow to pick up from a slump in early 2014. Purchases of new homes climbed last month by 6.4%, the first gain in three months, to a 433,000 annualized rate, Commerce Department data shows. The advance was led by a 47.4% surge in the Midwest.

Sales of previously owned homes rose 1.3% in April, the first gain this year, data from the National Association of Realtors showed. The increase showed signs of underlying softness, as investors continued to play a big role in the market and the share of first-time buyers was little changed.

Housing began to cool in the middle of 2013, with residential investment becoming a drag on the economy during the last two quarters, its worst six month performance since the first half of 2009.

“Housing indicators remain mixed. Mortgage rates are near a seven-month low but recent comments from the Fed point to bank lending standards as a problem,’ said David Blitzer, chairman of the S&P index committee.

The rise in borrowing costs eased in the second half of 2013, providing more incentive for buyers to come off the side lines. The average rate on a 30 year, fixed mortgage was at 4.14% in the week ended May 22, down from 4.53% at the start of the year, according to Freddie Mac. The latest rate…

New measures are to be introduced that will end outdated rules from the 1970s preventing London residents from renting out their own homes on a short term basis to visitors.

Currently under 40 year old laws dating from the time of the GLC (Greater London Council), Londoners who want to rent out their homes for less than three months technically still have to apply for planning permission from the council, something that doesn’t apply anywhere else in the UK.

These provisions caused controversy during the 2012 Olympics, and are irregularly enforced by different London boroughs leading to confusion.

Ministers now want to change this archaic system through a measure in the Deregulation Bill, giving Londoners the freedom to rent out their homes on a temporary basis, such when they are on holiday, without having to deal with unnecessary red tape and bureaucracy of paying of a council permit.

The measure will not allow homes to be turned into hotels or hostels as this would still require ‘change of use’ planning permission, and measures will be put in place to prevent abuse of such reforms or the permanent loss of residential accommodation, said Communities Secretary Eric Pickles.

He explained that the reforms will not just benefit London’s strong tourism industry by expanding the pool of competitively priced accommodation, but allow families to earn some extra cash when they themselves go away.

These reforms follow changes introduced last year to make it easier for residents to rent out an unused home parking space to earn extra money, helping expand the availability of parking options for commuters and visitors.

‘The internet is changing the way we work and live, and the law needs to catch up. We have already reformed the rules on renting out your unused parking spaces, now we want to do the same regarding renting out your home for a short period,’ said Pickles.

‘It’s time to change the outdated, impractical and restrictive laws from the 1970s, open up London’s homes to visitors and allow Londoners to make some extra cash,’ he added.

The provisions are set out under section 25 of the Greater London Council (General Powers) Act 1973, and only apply to London.

Following a consultation, ministers intend to amend these rules to give home owners greater freedom while retaining the protection that ensure homes built for Londoners are not used solely for short term letting. The amendment will be introduced through the Deregulation Bill.

New measures are to be introduced that will end outdated rules from the 1970s preventing London residents from renting out their own homes on a short term basis to visitors.

Currently under 40 year old laws dating from the time of the GLC (Greater London Council), Londoners who want to rent out their homes for less than three months technically still have to apply for planning permission from the council, something that doesn’t apply anywhere else in the UK.

These provisions caused controversy during the 2012 Olympics, and are irregularly enforced by different London boroughs leading to confusion.

Ministers now want to change this archaic system through a measure in the Deregulation Bill, giving Londoners the freedom to rent out their homes on a temporary basis, such when they are on holiday, without having to deal with unnecessary red tape and bureaucracy of paying of a council permit.

The measure will not allow homes to be turned into hotels or hostels as this would still require ‘change of use’ planning permission, and measures will be put in place to prevent abuse of such reforms or the permanent loss of residential accommodation, said Communities Secretary Eric Pickles.

He explained that the reforms will not just benefit London’s strong tourism industry by expanding the pool of competitively priced accommodation, but allow families to earn some extra cash when they themselves go away.

These reforms follow changes introduced last year to make it easier for residents to rent out an unused home parking space to earn extra money, helping expand the availability of parking options for commuters and visitors.

‘The internet is changing the way we work and live, and the law needs to catch up. We have already reformed the rules on renting out your unused parking spaces, now we want to do the same regarding renting out your home for a short period,’ said Pickles.

‘It’s time to change the outdated, impractical and restrictive laws from the 1970s, open up London’s homes to visitors and allow Londoners to make some extra cash,’ he added.

The provisions are set out under section 25 of the Greater London Council (General Powers) Act 1973, and only apply to London.

Following a consultation, ministers intend to amend these rules to give home owners greater freedom while retaining the protection that ensure homes built for Londoners are not used solely for short term letting. The amendment will be introduced through the Deregulation Bill.

England and Wales is facing a major shortfall in the delivery of new homes over the next four years due to a lack of readily available sites, according to a new report published by planning consultancy Turley.

The Turley Housing Updates report examines the published five year housing requirement and land supply position of the 318 Local Planning Authorities (LPAs) in England and Wales, excluding London, between April 2013 and April 2018.

It shows that according to approved plans, England and Wales will require at a minimum 1,197,000 new homes over the next four years. The report also reveals that LPAs claim to have land available for around 939,000 of these homes, leaving a substantial shortfall of at least 258,000 homes.

‘Local authorities are required under the National Planning Policy Framework (NPPF) to identify and update annually a supply of specific deliverable sites sufficient to provide five years’ worth of housing against their objectively assessed housing requirements. Our research and report shows that at least 211 of England And Wales’ 318 planning authorities fall short of their five year land supply targets,’ said John Acres, director, Turley.

The shortfall in the South West is 18,636, in the South /east 34,502, in the East 23,106, in the East Midlands 56,250, in the West Midlands 27,037, in the North West 45,340, in the North East 13,437, in Yorkshire and Humberside 27,900 and in Wales 11,765.

‘The majority of LPAs are falling short of their minimum five year housing land supply requirements, and this has significant implications for the pace of economic recovery. It is also likely to impact affordability for first time buyers wishing to enter the market,’ explained Acres.

‘The need for housing remains high and is growing yet many LPAs still do not have adopted up to date NPPF compliant Local Plans. This leaves planning policy in a state of flux and uncertainty that will further delay the delivery of much needed homes across England and Wales,’ he pointed out.

‘Those LPAs that do not have up to date adopted Local Plans will continue to receive planning applications but will need to judge them within the context of the NPPF and its presumption in favour of sustainable development,’ he added.
The Turley Housing Updates provides a snapshot of housing need and supply between April 2013 and April 2018 and is based on housing land supply data provided by the LPAs themselves.

Acres explained that the research represents a ‘best case’ scenario so in the absence of adopted Local Plans and as developers bring forward new sites and permissions for new sites are granted, there will be minor changes to these figures.

‘The substantial shortfall is, however, only likely to deteriorate as annual dwelling delivery rates remain below those needed to meet the overall requirements across England and Wales,’ he concluded.

Momentum in the Scottish commercial property market from 2013 has continued into the first quarter of 2014 with further improvements in investment performance, according to a new report.

The all property total return for the first quarter of the year was 2.8%, down slightly on the 3.3% in the fourth quarter of 2013 but this brings the annual total return through to the end of March to 10%, which is well ahead of the 0.2% at the same time in 2013.

This level of performance is consistent with wider signs of economic and occupier recovery that has been observed in Scottish commercial property since spring in 2013, says the report from property consultants CBRE.

However, relative to the UK as a whole, Scottish property continues to underperform, although the gap is beginning to close, particularly within the retail and industrial markets.

The report says that Scottish retail is currently the closest to UK rates of return, with an annual total return to the end of March of 8.6%, compared to a UK wide return of 10%.

Across all sectors Estimated Rental Value (ERV) growth remained weak in the first three months of the year. The already slow rates of growth that emerged over the second half of 2013 have fallen back during the first quarter of 2014.

As a result the all property capital growth rate of 1.2% was exclusively driven by inward yield movement, caused by the weight of money seeking opportunities in the Scottish commercial property market. Nevertheless, the report points out that this pace of growth marks the third successive quarter of rising capital values, which will be only boosted further once more substantive rental growth begins to emerge.

On a quarterly basis, retail performance edged down a little in the first quarter to post a total return of 2.3%, down from 2.8% in the fourth quarter. Capital growth for retail was the weakest of the three main sectors, with values up just 0.8% since the start of the year. A lack of any rental growth over the last six months, and more modest yield contraction, have contributed to this underperformance.

Whilst all sectors have seen lower total returns in the first quarter compared to the previous quarter, offices have been the most stable. The total return in the first quarter was 3.3%, down from 3.6% in the fourth quarter. As with retail, this performance has been driven by yield contraction alone.

Scottish industrials were once again the strongest performing sector in the first quarter, delivering a quarterly total return of 3.9%, although down from 4.7% in the previous quarter. Compared to both offices and retail, industrial benefited from 0.3% of rental value growth during the quarter, which assisted in pushing capital values up by 2.2%.

‘Little has changed in the relative performance between cities in Scotland, with Aberdeen offices and industrials continuing to show the greatest performance,’ said Aileen Knox, senior director from CBRE.

‘The office market in Aberdeen is the top…

Development land prices have started to gain momentum across England, following the trend in prime central London, according to a new report.

English land values rose by 7.3% in the year to the end of the first quarter of 2014, according to Knight Frank’s Development Land index, and developers are expecting further increases in the year to come.

More than nine in 10 respondents said they expect greenfield land prices to rise over the next year. Around a third said they expected increases of between 5% and 10%, while a further 29% said they expected a larger increase of up to 15%. The majority of respondents expect urban land prices to rise by 10% to 15%.

The sourcing and use of land for development remains a key factor in the sector, and it has now become a hot topic of political debate. The report suggests that house builders must ensure they have a flow of sites coming through with planning permission at the right time to enable them to build homes in line with their strategy.

‘The expected rise in activity in the next 12 months is certainly supported by our survey, which shows that 74% of respondents expect to increase their pipeline of land with planning, while 69% expect to increase their strategic land holdings,’ the report says.

But there is increasing debate about land banks, whether house builders are keeping land and not building it out in order simply to make a profit on re-selling it.

The Homebuilders’ Federation have questioned whether the idea of hoarding land is as big a feature in the market as commonly believed. It highlights that for the large house builders, only 4% of sites are waiting for work to start.

‘This goes to the heart of the question of whether strategic land, on which a house builder has agreed an option with the landowner, which may or may not lead to them gaining planning or buying the land, or which may be bought and have started the long process of going through planning, should be classed as a land bank,’ the report adds.

The survey showed that improving access to public sector land was the factor highlighted by house builders and developers as the biggest additional positive step the government could take to improve housing delivery.

Whitehall has already released 430 brownfield sites from central government departments, with the capacity to build 68,000 homes, meaning that the government is likely to meet its target of releasing enough land for 100,000 homes by 2015.

But Kris Hopkins, the Housing Minister, has called for even more public land to be released, especially at a local level.
The Strategic Land Review (SLR), published at this year’s budget, has identified some £5 billion of land and property that can be sold. There will be more detail given on how this will happen in this years’ Autumn Statement.

The report points out that the move to encourage local councils to release plots for self builders should…

The housing shortage in London is reaching critical levels as house building fails to keep pace with population growth and wages lag behind housing costs, according to a new report.

Less than half of the homes needed just to house new households are currently being built, with 52,500 new households expected to form each year up to 2021 but only 18,310 new homes built during 2012/2013, says the report from the National Housing Federation.

The shortage is making housing increasingly unaffordable. The average house price in the capital is 16 times the average wage and is set to rise another 43% by 2020, the biggest jump in the country.

Suburban areas such as Brent have not escaped affordability problems, with house prices hitting nearly 17 times the average salary of £23,280. The annual income needed for the average mortgage in Brent is £90,169, the report points out.
More than 80% of businesses surveyed across the country said a lack of affordable housing is stalling economic growth, with 75% warning it would affect their ability to attract and keep workers.

The report also shows that the average house price in the capital in 2012 was £438,636, some 87% higher than the average for 2002 and the average London rent is £1,400 a month with private rents expected to rise by 32% by 2020.

‘England appears to be moving towards economic recovery, driven significantly by London’s dynamism and the city’s prominence as a global financial centre. But as the capital thrives, the result for ordinary Londoners is an overheated housing market with people struggling to buy or rent a home of their own,’ said Dave Smith, London external affairs manager for the National Housing Federation.

‘Rising housing costs are bad news for Londoners and bad news for businesses. Young people and families are struggling to afford a home in the capital and are being pushed out, away from jobs and schools. London can’t continue to be a hub for talent and enterprise if people can’t afford to live here. To retain our competitive edge on the international stage, we need housing that is affordable for people on a range of incomes,’ he explained.

‘If things don’t change, London’s much needed economic growth could be stifled and businesses could struggle. Building more homes could be the crucial difference between a thriving world city and a capital in decline. The Mayor, the Government and the London Enterprise Panel must work with housing associations and other partners to revitalise the struggling housing market, bringing with it the jobs and infrastructure that will cement our economic recovery,’ he added.

Property price growth in Istanbul was more than twice the rate of growth in April compared with a year ago, according to the latest figures to be published.

In the first two months of the year prices in the Turkish capital appeared to be rising at a more moderate pace than in 2013. Then in April they by more than 1% in a month, according to the data from Gyoder.

Adil Yaman, investment director of real estate agency Universal 21 believes that the property market is set to grow faster than ever this year as demand from foreign investors and locals remains strong in most areas of the city.

‘We would normally expect fluctuations in growth in the early part of the year, which are traditionally times when the market takes a breather,’ added Yaman.

Universal 21 analysts pointed out that the buying season normally reaches a peak in August with strong growth also seen in June and July. In August 2013 for example property prices in Istanbul increased by more than 2% in a month, which would add £1,000 to the price of a £50,000 apartment in the city.

According to statistics released earlier in the year, Istanbul saw the highest annual increase in property prices at up to 18.59% compared to Antalya at 5.85 in the same period.

Monica Anca, director of Universal 21, said that Istanbul is an engine for property growth in Turkey, much as London is in the United Kingdom.

‘The city has seen huge investment in its infrastructure, which hasn’t always been popular with locals but the pace of change in the city is rapid and the population is rising with it. So it comes as no surprise that this puts pressure on existing housing stock,’ she explained.

‘The health of the property market is important to Turkey’s economy as it is in other countries because it provides jobs in construction and helps provide a platform for growth in other areas of the national economy,’ she added.

‘Along with the recent announcement of a third airport in the city which will provide a boost to suburban areas like Beylikduzu, I think all the signs are positive for another year of strong growth,’ she concluded.

The UK government’s Help to Buy scheme which is credited with helping more first time buyers onto the property ladder, is most popular with people aged 20 to 29 years, new research shows.

A survey of estate agents across the country confirms that first time buyers are the main adopters of the scheme, using the government backed initiative to secure a mortgage, with 86% of estate agents noticing this trend.

Second steppers came in second place, making up nearly 18% per cent of the Help to Buy market, the survey Move with Us, one of the UK’s largest network of independent of estate agents, also shows.

Further results show that 78% of people using Help to Buy are young couples, 10.5% are single and 9% are families, 7% have used the government incentive to upsize and just 3% have used it to downsize in the last six months.

Looking at the regional breakdown, the government scheme has been a lifeline for many young aspiring home owners in areas where house prices can be prohibitive for many.

For example, in Greater London where the average asking price has risen 18.94% in a year to reach £438,118, some 93% of people using the Help to Buy scheme are typically aged 20 to 29.

In the North East this figure is lower with 85% adopting the scheme where property prices are an average of £153,413 having only risen 0.70% in the last 12 months.

Considering all their buyers and not just those using the Help to Buy scheme, estate agents noted that 52% of their buyers are aged between 30 and 39, some 25% are 40 to 49, 16% are aged between 20 and 29 and 3% of home movers are over 60.
‘The Help to Buy scheme has been at the centre of many debates. Despite clearly helping some aspiring home owners to get a foot on the property ladder, it has come under criticism for potentially creating another housing bubble and not tackling the housing shortage,’ said Robin King, director at Move with Us.

‘A blanket approach to solving the housing crisis in Britain won’t work because there are very different markets in play. Greater London and the North East are polar opposites. Help to Buy should only be available in regions that need stimulating, such as the North East, otherwise it will create a housing bubble. If it were only accessible in markets where there is enough housing stock to keep pace with demand, prices wouldn’t be artificially inflated and affordability reduced, the very thing Help to Buy was introduced to combat,’ he explained.

‘The focus should be on creating more affordable housing and looking at introducing schemes and solutions aimed at injecting more money into the supply chain so there are enough bricks, mortar and quality tradesmen available. Tacking the supply shortage is the best way to create a sustainable solution to this widespread housing problem,’ he added.

House prices in the UK increased by 3.9% in May, the third monthly increase since the beginning of the year, according to the latest index from leading property lender the Halifax.

It is a sign that the growth in the market does not seem to be softening as some commentators have suggested and an examination of the quarterly figures seems to bear this out. Monthly movements, however, can be volatile and the quarter on quarter change is a more reliable indicator of the underlying trend.

House prices in the latest three months from March 2014 to May 2014 were 2% higher than in the preceding three months of December 2013 to February 2014. House price change on this measure has now remained steady in a narrow range of 1.9% to 2.3% since June 2013.

Prices in the three months to May were 8.7% higher than in the same three months a year earlier. This was marginally higher than in April when it was 8.5%.

The index report points out that home sales edged down by 1% in April to 103,690, however, transactions are still a third higher than in April 2013. Annually, transactions grew to 1.142 million in the year to March 2014 a rise of 23% from the same period a year earlier according to seasonally adjusted figures from HMRC.

The Halifax says that the growing difference between housing demand and supply continues to be a key driver of house price increases. Growth in new buyer enquiries have remained steady so far this year while the number of home owners providing instructions to put their property on the market for sale declined for the fourth consecutive month.

However, latest house building figures show signs of improvement which could help to bring demand and supply into better balance. The number of private housing starts in England in the year to March 2014 increased by 34% to 108,400 from a year earlier, according to the Department of Communities and Local Government.

‘On an annual basis housing demand is still strong and continues to be supported by a strengthening economic recovery. Consumer confidence is being boosted by a rapidly improving labour market and low interest rates, although growth in average earnings still remains weak,’ said Stephen Noakes, Halifax mortgages director.

‘However, there are signs of a revival in house building which should bring supply and demand into better balance and curb upwards pressure on prices over the medium and longer term,’ he added.

Home price growth in the United States has softened for a fifth consecutive month with values predicted to normalise in the 5% range by the end of this year.

According to the latest monthly report from real estate data provider Clear Capital, although expectations were high heading into spring, it’s been a decidedly underwhelming season. According to the report good deals do exist, but you need to work harder to find them. Savvy investors with deeper market insight into current market dynamics will be rewarded, the report says.

However, despite a lethargic spring buying season, annual price growth in the 50 major metro markets stands at 22.3% although there is some considerable variation depending on location. Price growth has varied from a fall of 37% to growth of 45%.

There are even large local market variances. For example, in Cleveland the top performing ZIP code area has seen annual growth of 42.3% and the lowest was a fall of 23.3%. But in Rochester, New York, the spread is much narrow with just 4.4% difference between top and bottom.

‘It’s no surprise that the spring buying season isn’t moving the needle this year. The rising price floor in the low tier sector of the market has squeezed investor returns, thereby removing a key demand segment. We don’t expect to see a large pop in prices through the summer buying season. It’s likely we’ll keep chugging along at our current pace, somewhere around 1% quarterly gains for the rest of the year,’ said Dr. Alex Villacorta, vice president of research and analytics at Clear Capital.

‘Considering the number of key housing fundamentals that remain stressed, like millions of borrowers still underwater, high levels of student debt, potential borrowers with less than perfect credit, and a job market that is still recovering, we don’t expect a market with waning investor demand to withstand any eye-popping rates of growth. Although it’s not a quick fix to the larger housing problem, home price moderation is really a healthy move for the market overall,’ he explained.

‘While some might be discouraged by a weak spring buying season, we are encouraged that price trends are finally calibrating back to pre-bubble norms. Despite other headwinds, moderating home prices will serve as the foundation to a more balanced market moving forward,’ he said.

‘Remember, we’re still in recovery mode which means deals exist. Market participants just need to look deeper. As softer gains continue to unfold, broad stroke investment approaches will prove less and less fruitful. As such, market participants who pin point investments will be better positioned for success,’ he added.

Retired home owners in the UK now own property worth £807 billion with their total property wealth increasing by more than £6.3 billion in the past three months, the equivalent of around £1,340 each.

New research from over 55s financial specialist Key Retirement Solutions says that their total property wealth is now at its highest level since the firm started monitoring the housing wealth of the over 65s in March 2010.

Its Pensioner Property Equity Index shows over-65 homeowners now own property wealth of £807.249 billion outright as house prices across most of the UK rose and the growth in property prices is helping to drive the equity release market which enables home owners to release money from their houses.

Key Retirement Solutions figures show £339.8 million was released in the first three months of this year with the average customer taking more than £61,230 from their home.

Retired home owners in London were the biggest winners gaining nearly £10,700 on average each in the past three months while retired homeowners in Eastern England are more than £4,290 better off and pensioners in the South West are £2,283 better off.

But there were sharp falls in some areas. Over 65 home owners in Wales saw their average property wealth fall by nearly £5,000 in the three months while Scottish pensioners lost nearly £3,900. Retired homeowners in the North West lost £966.

The figures also show more than 36.7% of pensioner property equity is owned by over 65s in London and the South East. In London over 65s own property without any mortgages worth £151.7 billion while in the South East pensioners own £145 billion of property outright. More than 70% of pensioner property wealth is concentrated in London, the South East, the South West, the East of England and the North West.

‘Pensioner property wealth is at a new record high of £807 billion as the housing market continues to grow, and average gains of more than £1,346 in just three months highlights that property wealth should be a major part of retirement income planning,’ said Dean Mirfin, group director at Key Retirement Solutions.

‘Even home owners in areas where prices have fallen still have considerable property wealth considering they own their homes outright and will have seen strong gains,’ he added.

The sales market in prime central London is active for properties priced correctly but overall sales are down 17% year on year, a new report shows.

The latest monthly report from residential sales and lettings firm W.A. Ellis says that realistic pricing is key and it is the family house market that is the most buoyant but supply outweighs demand in various areas of the market.

Although there has been much talk of a housing bubble, a more cautious story is emerging in the prime central London property market, according to Richard Barber, partner with the firm.

‘It is the rate of transaction which is of most concern and a strong barometer of confidence within the upper end of the London market. In May 2013 some 932 properties in total were sold throughout London. However, this May, there have only been 774 sales, almost a 17% reduction in transaction levels year on year,’ he pointed out.

‘It is also interesting to note that 25% of the house stock currently available on the market has been reduced in price, indicating an initial optimism now countered with a distinct sense of realism, as the window of opportunity within the Spring/Summer market begins to narrow,’ he said.

He also pointed out that year on year the average rate per square foot achieved on houses is 1% down from the £1,876 per square foot that was being achieved in the first quarter of 2013. In the first quarter of this year it was £1,858 per square foot.

‘That said, we are enjoying an active spring market with correctly priced property selling well but the froth has undoubtedly come off. We believe that this is partly due to the government’s tax on ‘enveloped dwellings’ (those held in company names) and the increase in SDLT. Looking ahead, realistic pricing is key if one wishes to effect a sale within the next six weeks before the traditional summer slow down,’ explained Barber.

The lettings market is sporadic with supply now outweighing demand in various areas of the market, according to Lucy Morton, senior partner and head of lettings at W.A. Ellis. There has, however, been increased activity in the sub £1,000 per week one to two bedroom price range, and she is also seeing a very buoyant family houses market.

‘We have seen a 12% increase in the letting of family houses since January 2014 compared with the same period in 2013, and as families are keen to settle before the start of the new school year, we cannot see this waning,’ she explained.

‘We have recently launched four substantial family houses in Kensington and Chelsea, and are already receiving a healthy number of enquiries from families who are beginning to come to London to get settled this summer. A five bedroom house we launched on Brompton Square has already gone under offer at a rent above the outgoing rent with no void, and on the same day, a tenant gave notice on a fantastic five…

The majority of landlords in the UK considering future property purchases plan to buy in their local area, according to the latest research from the National Landlords Association (NLA).

Three quarters of private residential landlords say their next property purchase will be close to home or in or around the area that they currently live.

The research also shows that just 10% plan to purchase within a 100 miles radius and 9% say they plan to buy further afield.

The news comes as more and more councils across the country are turning to costly and ineffective landlord licensing schemes which could have a detrimental effect on local investment.

‘Local investment in housing is essential if towns and cities across the UK want to attract people and business to the area. The private rented sector (PRS) is growing at a steady rate but we still need further investment in housing if tenant demand across the UK is to be met,’ said Carolyn Uphill, NLA chairman.

‘These findings are positive news and show that landlords can provide a vital lifeline for local councils who struggle with the ever growing demand for housing in their area. It means that councils considering introducing licensing schemes should take these findings on board as otherwise they will alienate a significant proportion of landlords and in doing so deter much needed investment,’ she added.

The NLA has also compiled a list of key considerations for first time landlords looking to a new and successful local property investment, which is part of its Professional Practice for Profit campaign.

It suggests they should find out about local tenant demand and what types of tenants are most attracted to the area as well as local employment conditions.

They should research local market rent levels like and what rental yields can be expected and work out how desirable the property will be in terms of proximity to transport connections, schools and local amenities.

They should also look at the likely capital value potential and whether there are any future development plans in the area and what are local crime levels are like.

The typical time on the market for a property in England and Wales is now 90 days, the shortest it has been since April 2008, according to new figures from Home.co.uk.

However, the firm points out that 90 days is simply the median figure across both overheating and cooler regional markets and there is considerable variation depending on location.

At one extreme, Greater London has a low marketing time of 48 days, which is equivalent to the on market time observed in the previous boom. The South East is also a fast market showing boom time length marketing times as supply slows to a mere trickle and properties get snapped up by eager buyers spurred on by the Help to Buy scheme.

By contrast, the North East and Wales show a typical on market time of 167 and 166 days respectively. These and similar slow regional markets are burdened by a backlog of properties that have been on the market a long time, in many cases more than a year, it says. Vendors there are simply waiting for the market to pick up and the North, Wales and Scotland are seeing ample supply relative to demand hindering the property market recovery despite the Help to Buy scheme and low interest rates.

‘The UK property market remains highly diverse in respect of marketing times. London seems a world away from the difficult and slow markets in the North. The sub-inflation price rises observed in Yorkshire, the North West, Scotland, Wales and the North East correlate well with the long marketing times shown above and indicates that, contrary to the rest of the country, supply is broadly in balance with demand in these regions,’ said Doug Shephard, director of Home.co.uk.

‘However, market conditions are currently improving rapidly in the North, Scotland and Wales. Hence, we may soon be able to add some, if not all, to the list of booming regional markets over the next 12 months. Goodness knows how the London and South East markets will look by then,’ he added.

Is now the right time to invest in property?

Is it fair that you can just pay a couple of millions to buy a British asset?

For years prime central London property has been likened to gold dust attracting rich tycoons with gazillions buying up property in Mayfair, Belgravia, Chelsea and Kensington.

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