Tim, the Auctioneer giving a quick overview of our inaugural ‘Live Broadcast Auction’. Watch the video below.
Essential Information Group, the UK’s biggest property auction portal, has reported a strong set of UK auction results for February 2018 with residential property performing the strongest in terms of sector growth.
Against the previous year, the total number of Lots offered for sale by auction last month showed positive growth of almost 6% delivering a 3% increase in sales. Residential property saw the biggest rise in Lots offered for sale with the strongest ever figure recorded for February at 3,437, an increase of 8% versus 2017 and +5% in the rolling quarter.
In particular, East Anglia remains one of the top performing regions for property auction Lots offered and sold realising gains in February compared with the previous year of 14.6% and 21.7% respectively with an average sale success rate of 81.3%, up 6.3%. The number of residential property auction Lots offered increased by 16.2% and commercial by 8.9% with average sale success results increasing by 7.6% for residential and 2.0 % for commercial property.
Here at Goldings Auctions, on 7 March, we held our biggest sale in 10 years of trading raising over £3.5m and selling 22/23 Lots, a sale success rate of 96%. In conclusion, we are very positive about the robustness of the current and future property auction market across our local regions of Suffolk, Norfolk and Essex.
The EIG Newsletter for March can be read by clicking this link.
For further advice on what to do after purchasing your property click here.
The full February results for the UK and its regions can be accessed here.
Following advice issued by the Met Office and a yellow weather warning in place for the East of England, we have made a business decision to delay Wednesday 28 February’s sale by 7 days.
Therefore, our forthcoming property auction will now be held on
Wednesday 7 March at 14:15.
The time and venue at Wherstead Park, Wherstead will stay the same.
Road links following the A12, A14 and Orwell Bridge may become inaccessible and we do not wish to put any of our clients at risk.
Another e-mail alert will be sent out prior to7 Marchto confirm everything is going ahead and back to normal.
We understand this may not be suitable for all of our buyers, however we will do everything we can to help with telephone / proxy bidding if you can’t attend next week – call us to discuss.
We have not taken this decision lightly and apologise for any inconvenience caused. In the meantime if you have any questions, please contact our team on 01473 210200.
Barclays Bank PLC has conducted detailed research into the current state of the UK property market and as a result forecasts a positive outlook over the next 5 years with UK property prices, on average, set to rise by 6.1%.
(Barclays, Ipswich Branch 2017)
Using the Barclays UK Property Predictor, the company has given a 3-to-5-year projection on residential property investment hotspots, defining key areas where house and rental income values will see solid future growth.
Factors used to provide such data include rental trends, employment levels and commuter behaviour together with current house prices to present an index of UK areas attractive to buyers’. High Net worth Investors from across the UK were also surveyed, to reveal their reasons and locations for future property investment.
By the end of 2021, London is expected to realise the biggest regional gains of 11.88%, followed by our region of East Anglia with 9.38%. The South East comes in next at 8.74% then the East Midlands (6.67%), West Midlands and Scotland, both predicted 5.88% growth; other UK areas are also covered.
Based on the reported UK average property rise of 6.1%, average prices will reach £300,000 by 2021.
Dena Brumpton, Chief executive of Barclays’ Wealth and Investments Division explains:
“It’s encouraging to see that property is still viewed as an important part of the investment portfolio with high net worth investors typically owning three properties and over a quarter planning to buy property because they believe that it offers long-term investment security.
“There is also increasing confidence among property investors, as many are taking a long-term view when it comes to putting money into property. It’s also interesting to see from our research how investment prospects are emerging outside of the established property heartland of London and the South of England, with economic growth and employment opportunity fuelling growth in hotspots across the UK.”
The named property hotspots and summary of Barclays’ research can be found by clicking this link.
Nationwide’s most recent House Price Index Report shows that East Anglia tops the table for 2016 regional UK growth with average values rising year-on-year by 10.1%, the first time our region has led the table since 2010. More positively, if we look at the percentage change for Q4 of 2016, East Anglia was the only southern region not to see a further slow in annual price growth versus Q3 with Q4 average prices reaching £218,544.
Overall, Nationwide reveals that average 2016 UK prices ended the year at £205,898, representing annual house price inflation of 4.4%, the same figure as 2015.
For the first time since 2008, London’s house price inflation was less that the UK average, standing at 3.7%. The weakest performing region was the North, reporting almost no rise at all for 2016, the average gap compared with the South continuing to widen at £170,000, approximately £11,500 greater than last year, thus creating a “striking” difference in affordability.
Robert Gardner, the Chief Economist for Nationwide surmised that annual UK house price growth was stable and commented on the outlook for 2017:
“Looking ahead to 2017, house price prospects will depend crucially on developments in the wider economy, around which there is a greater degree of uncertainty than usual.
“Like most forecasters, including the Bank of England, we expect the UK economy to slow modestly next year, which is likely to result in less robust labour market conditions and modestly slower house price growth.
“But we continue to think a small gain – around two percent – is more likely than a decline over 2017 as a whole, since low interest rates are expected to help underpin demand while a shortage of homes on the market will continue to provide support for house prices.”
Click here for Nationwide’s latest House Price Index report.
For 2017 outside London, Rightmove is projecting a 4% increase in asking price rents.
Beyond London, the property portal reported a 3% rise in rental figures during 2016, whereas inside the capital saw a 4.4% drop. Inner city London figures fell by 5.2%, while a lesser drop of 2.5% was experienced in outer London.
All regions excluding London saw gains, the biggest growth seen in the North and North West with a focus on Yorkshire and the Humber.
Nationally, Rightmove calculated the average monthly rental on a two-bedroom property together with its website’s average asking price for that property type to determine the final yield value. The yield is a landlord’s expected annual rental return as a percentage of the property’s value.
Sam Mitchell, Head of Lettings at Rightmove commented on 2017:
“We definitely won’t see the spike in Q1 purchases that we saw last year as landlords rushed to buy before last April’s new Stamp Duty deadline.
“If the tax changes being phased in from this April lead to even fewer buy-to-let purchases and some landlords deciding to sell, then a tightening of supply in some areas will lead to increasing rents.
“We forecast that asking rents could rise by 4% outside London by the end of 2017, though in London prices are likely to stay flat.”
He also said: “Investors looking for the strongest yields could consider investing in certain areas in the north-west where both demand and yields are high.
“Those with a number of properties in the capital may find that tenants are more price sensitive, so setting realistic rent levels will be the key to avoiding void periods.
“In order to mitigate this, we would recommend landlords asking for longer tenancies to help secure a steady rental income over the next few years while they adjust to what the tax changes will mean for them.”
This news has also been reported on Yahoo! Finance, which can be read by clicking here.
Nationwide and Halifax put a lot of work into providing us with useful numbers when it comes to house prices, but unfortunately they can be confusing.
For example, in February, Nationwide saw house price gains of 0.3%, whereas Halifax quoted a slide of 1.4%. In terms of house prices, Nationwide placed the average UK home at £196,930 compared with January’s £196,829, however Halifax reported the average for the same period had decreased from £209,495.
Robert Gardner, Nationwide’s Economist, reported almost 75,000 mortgage approvals in January, an increase of 4,000 from December and said:
“Much of the increase is likely to be related to the impending increase in Stamp Duty on second homes, due to take effect in April. “This is likely to have brought forward a significant number of purchases, which in turn will probably result in a fall back in approvals during the spring/summer.”
Halifax’s Economist Martin Ellis stated that a “significant imbalance between supply and demand” still existed, but felt there were tentative signs that the current supply of available properties for sale could be starting to improve.
We all realise that this information is just a guide. As to which one is more useful…I think we’ll leave it up to you to you decide!
Click here for Nationwide House Price Index and choose this link for Halifax’s equivalent.
The Telegraph has recently reported new potential changes, which could restrict buy-to-let mortgages in an effort to cool the housing market:
Response needed over concerns the housing market is overheating
Bank of England may gain powers to rein in buy-to-let mortgages
Buy-to-let a preferred means of investment vs. low savings rates
The article suggests that new changes could happen within months to restrict the availability of buy-to-let mortgages, as part of a crackdown following reactions to unprecedented house price increases. This news coincides with a report revealing initial findings into lending standards due to be released by the Bank of England on 29 March.
The Chancellor George Osborne told the Commons Treasury Committee on 24 March:
“The measures I have taken in the last couple of fiscal events – on additional Stamp Duty, on changes to mortgage interest relief – have been done in the knowledge that the Bank of England has concerns about a bubble emerging in the market.”
So many people in the UK have invested in buy-to-let properties to combat the poor returns on savings, but regulators are concerned that some could be amassing debt and a false spike in property prices might be generated.
The Financial Policy Committee (FPC) wants powers granted, which ensures regulators introduce limits on buy-to-let lending in terms of loan-to-value ratios or interest coverage rations (ICRs), i.e. the ratio of the projected rental return from the buy-to-let property versus the expected mortgage interest payments.
The new crackdown comes after this week’s launch of a 3% Stamp Duty Land Tax surcharge on the purchase of additional homes.The Telegraph article can be found here.