Our monthly property market review is intended to provide background to recent developments in property markets as well as to give an indication of how some key issues could impact in the future.
LONDON PROPERTY LOSES ITS LEADING PRICE GROWTH RATE
The latest data released by The Land Registry, showed that contrary to historical precedent, London residential property over the past few months registered one of the slowest price growth rates in the country at 2.8% in the year to July 2017. This represents the eighth consecutive month that London property price growth has been below the national average.
They go on to report that, according to the Bank of England Agents’ summary of business conditions for August 2017, the residential property market remains muted. However, the new homes market, aided by the Government’s ‘Help to Buy’ programme, has strengthened.
SCOTLAND RESIDENTIAL SEES STRONGEST MARKET SINCE 2008
Although property taxation rates have been increased in the region, Scottish residential property is enjoying its strongest market conditions for over ten years.
Savills’ latest Spotlight on Scottish Residential Property summarises that should the devolved Scottish parliament reconsider Land and Buildings Transaction Tax (LBTT) rates, there is no reason not to see Scottish property prices rivalling the performance of other markets south of the border and across other regions of the United Kingdom.
Although the lack of supply, particularly in prime areas such as Edinburgh, as a result of the LBTT levy, has frustrated the market somewhat, other areas, such as Greater Glasgow, have enjoyed a buoyant market. Regional locations are increasing in popularity, with a greater number of buyers coming from outside Scotland, looking for properties in established towns, with access to the major cities.
JULY SEES AN INCREASE IN REMORTGAGING ACROSS THE UK
UK Finance data, the former Council of Mortgage Lenders (CML), report that first-time buyers in the UK borrowed £5bn in July 2017. Although this figure is 15% below the previous month, it represents a 14% increase on June 2016.
Importantly though, remortgaging by current home owners, totalled £6.7bn in July. This figure represents an increase of 12% on the same month last year. In numerical terms 36,800 people remortgaged in July, an impressive increase of 7% on the previous month.
The Head of Mortgages Policy at UK Finance, June Deasy, commented on these findings: “Remortgaging strengthened in July and reached its highest level since January, with customers attracted by borrowing rates that are at or close to their historic low point. The increase in activity in July means that, over the last year, the number of people remortgaging has been at its highest since 2009. Lending for house purchase was lower in July than in the preceding month, and we expect the market to continue to soften a little in the coming months.”