David Cameron: There is No Housing Bubble

This article and video by The Telegraph on September 29th, 2013 shows David Cameron's explanation why government is launching help-to-buy three months early during his speaking engagement on BBC (Andrew Marr Show).

To watch the video click here.

Prospective homeowners will be able to use the Government’s subsidised mortgage scheme from as early as next week after the Coalition decided to bring the launch date forward by three months.

On the even of the Conservative party conference in Manchester, David Cameron revealed that the state-backed lenders, Royal Bank of Scotland and Lloyds Banking Group, would be offering deals under the Help-to-Buy scheme from next week instead of January.

It will initially be available under the Nat West, RBS and Halifax brands. A Tory spokesman said that other banks are expected to take part over time.

The second phase of the controversial scheme will help people buy a home worth up to £600,000 with just a 5pc deposit. The Government will guarantee the next 15pc of the loan for a fee, reducing the banks’ risk of loss so they can offer cheaper mortgages to higher-risk customers.

The scheme will be available for three years on up to £130bn of mortgage lending.

Critics have warned that the guarantees will inflate a dangerous housing bubble at a time when the property market is already showing signs of recovery. Citing analysis by the Bank of England, the Prime Minister countered on BBC’s Andrew Marr show that the market was only recovering and there was no sign of a bubble.

Mr Cameron added that if he didn't introduce the scheme, then "it will only be people with rich parents who can help then with the deposit who can help them on the housing ladder. That's not fair, it's not right, it's not the sort of country I want to live in and that's why it's important we bring this forward."

Video courtesy BBC One's The Andrew Marr Show

Article Source: http://www.telegraph.co.uk/news/politics/david-cameron/10342400/David-Cameron-there-is-no-housing-bubble.html 

Private Residential Rental Prices Up Across the UK

This article by the Property Wire on September 26th, 2013 shows that according to the new index from the Office of National Statistics private residential rental prices paid by tenants in the UK rose by 1.2% in the 12 months to August 2013.


Excluding London, were rents are higher than the rest of the country, rental prices were up by 0.8% during the same period, the data also shows.

There were also regional variations with rental prices up by 1.3% in Scotland and Wales and by 1.1% in England. But within England rental prices were up 1.9% in London and 1.1% in the South East of England.

The Index of Private Housing Rental Prices (IPHRP) is a new experimental index that measures the change in price of renting residential property from private landlords and calculates changes in the prices paid by tenants for renting private housing instead of calculating changes in the latest agreed rental prices.

The index examines how much tenants in privately rented accommodation pay in a month compared to the same month in the previous year. ‘This is a new official statistic undergoing evaluation and therefore it is recommended that caution is exercised when drawing conclusions from the published data as the index is likely to be further developed,’ said an ONS spokesman.

The index report says that the large weight that London has in the overall data reflects its high average rental prices and its large volume of private rented property.

All the regions in the UK have experienced rises in their private rental prices since 2011 and since January 2011 England rental prices have increased more than those of Scotland and Wales.

Until April 2013, the annual rate of change in the IPHRP had been higher in England than in Scotland or Wales. However, the annual rate of change has been increasing in Wales and Scotland since late 2012 and is, in August 2013, higher in these countries than in England.

The IPHRP series for England starts in 2005. Private rental prices in England show three distinct periods: rental price increases from January 2006 until November 2009, rental price decreases from December 2009 to November 2010, and increasing rental prices from December 2010 onwards. Of these three periods, 2008 showed the largest rental price increases.

Excluding London, England showed an increase of 0.7% for the same period. From August 2012 to August 2013 private rental prices increased in the nine English regions.
The data also shows that rental price increases have been stronger in London and the South East than the rest of England since January 2011.

The figures highlight the heat building in the London market, according to Jonathan Hopper, managing director of property finders, Garrington. ‘During the Autumn we are expecting to see increasing pressure from those wanting to rent as supply tightens leading to a further firming of rental prices,’ he said.

Article Source: http://www.propertywire.com/news/europe/uk-residential-private-rents-201309268283.html

Bank of England Watches for Possible Property Bubble

This article by Huw Jones and William Schomberg of Independent.ie on September 26th, 2013 shows how Bank of England will keep a watchful eye for possible dangers of another property bubble.

The Bank of England said on today there was no immediate danger of a property bubble in Britain but that it was keeping a watchful eye out.

It also said it wanted more study on how vulnerable hedge funds that rely on borrowing would be to future interest rate rises.

The central bank's Financial Policy Committee (FPC) said Britain's housing recovery "appeared to have gained momentum and to be broadening" but was under control, based on gauges such as level of activity, debt costs and prices compared with incomes.

"In view of that, the Committee judged that it should closely monitor developments in the housing market and banks' underwriting standards," it said in a statement after its September 18 meeting. "The Committee would be vigilant to potential emerging vulnerabilities."

If any action was needed, it would be "proportionate to the risks and consistent with a graduated response."

House prices in Britain as a whole rose 3.3pc in the 12 months to July but jumped nearly 10pc in London, official data showed last week.

This has triggered some concern that BoE and government lending incentives are creating a housing bubble.

Stephen Lewis, chief economist at Monument Securities said the FPC - which is tasked with spotting risks to the economy from the financial system - was right to hold off for now. "It's probably the right thing at the moment. There is a lot of uncertainty at present about the housing market."

The housing recovery has been helped by government and Bank measures to free up mortgage lending. A new phase of the government's Help to Buy programme is to be launched in January.

Governor Mark Carney and finance minister George Osborne have shown no concern about the prospect of a housing price bubble, pointing to levels of activity in the property market that are below their pre-crisis peak.

But earlier this month, a group representing British property surveyors called on the Bank to take measures to slow mortgage lending if national house price growth exceeds 5pc a year.
Ed Miliband, leader of Britain's Labour opposition party, said this week that if he wins election in 2015 he would more than double the number of new homes built annually to 200,000 by 2020 to ease a shortage that has helped to push up prices.

FOCUS ON HEDGE FUNDS

In June, the BoE ordered an investigation into the vulnerability of Britain's financial institutions and borrowers to higher interest rates when central banks around the world start to wean their economies off massive stimulus.

The FPC said in its statement on Wednesday that a moderate rise in long-term interest rates did not pose an immediate threat to major banks and insurance companies and so far "had not led to dislocations in market functioning or significant impact on financial institutions."

However, levels of leverage within hedge funds, which could make them vulnerable to a sharp rise in borrowing costs, "needed to be looked at more closely," the statement said.

The Financial Conduct Authority, which is represented on FPC, said it asked a number of hedge funds during the summer about their preparedness for changes in interest rates following the June FPC meeting and as part of routine supervisory work.

The FPC's wider review of rate hikes would continue by looking at what impact "more significant stresses" would have and how any impact would ripple through the financial system.

The FPC said it will publish on October 1 a discussion paper on the design of a new framework for stress testing banks.

Article Source: http://www.independent.ie/business/bank-of-england-is-watching-for-signs-of-uk-property-bubble-29609879.html

US Consumer Confidence Drops as House Prices Rise at the Fastest Rate in 7 Years

This article by AFP of The Telegraph on September 24th, 2013 reveals the decrease in consumer confidence as house prices rise and shortage in jobs and earnings resurfaced.

US consumer confidence fell slightly in September as Americans grew more wary about the outlook in coming months, according to a closely watched report. 

The Conference Board said its consumer confidence index fell to 79.7 in September, down from a revised 81.8 in August.

Though a decline was expected for September, the figure was weaker than the 80.0 consensus estimate.

"This is in line... with buyers awaiting a battle among lawmakers over raising the Treasury debt ceiling that could threaten a government shutdown," said Nate Kelley of Moody's Analytics.

The Present Situation Index rose to 73.2 in September from 70.9 in August.

The Expectations Index, indicating consumers' views on the outlook six months into the future, dived to 84.1 from 89.0 last month.

"Consumer confidence decreased in September as concerns about the short-term outlook for both jobs and earnings resurfaced, while expectations for future business conditions were little changed," said Lynn Franco, the Conference Board's director of economic indicators.

"While overall economic conditions appear to have moderately improved, consumers are uncertain that the momentum can be sustained in the months ahead."

Consumers' outlook on jobs and incomes in the coming months darkened.

The number of consumers expecting more jobs fell to 16.9pc from 17.5pc in August, while those anticipating fewer jobs rose to 19.7pc from 17.2pc.

Income expectations were sharply lower. Those expecting their incomes to increase tumbled to 15.4pc from 17.5pc.

The concerns about lower incomes could crimp consumer spending, the engine of US economic growth.

The decline in expectations "also gibes with our call for a relatively weak holiday shopping season this year," said Moody's Kelley.

But while consumer confidence declined, a closely-watched survey of house prices across 20 major US cities showed that property values increased 12.4pc in the year to July. The rise, the highest in seven years, was widely expected by economists, but some foresee a cooling over the rest of the year as mortgage rates climb.

Lawrence Yun, chief economist at the Realtors group, said the surge in sales in August was probably the “last hurrah” for the next year to 18 months as higher prices and the jump in mortgage rates hurts affordability for some buyers.

Article Source: http://www.telegraph.co.uk/finance/economics/10331727/US-consumer-confidence-slips-as-house-prices-rise-at-the-fastest-rate-in-seven-years.html

Landlords - Are You Ready for the Winter?

This article by Stride on September 4th, 2013 covers how landlords should be ready for winter and check if their properties are still in good state and repair in the col weather.

Autumn is upon us with the temperatures cooling down and evenings closing in, it's the ideal time for landlords to check their properties are ready for the winter months.

Properties need to be in a good state of repair and able to cope with the rigours of the cold weather, while tenants may start to look elsewhere for somewhere to live if they find the house an unpleasantly cold one to live in, or too expensive to heat if bills are not included in the rent.

There are several steps that a landlord can take to ensure the home is ready for the colder weeks and months ahead, both on the inside and out.

Guttering is one area that needs looking at, not least as wind, rain and falling autumn leaves can turn a gutter or downpipe into a disaster area. Overflowing can cause water to seep into brickwork and stone, damaging this and causing damp. So these channels should be checked to ensure they are in good order and not blocked. In addition to this, check if any of the mortar is cracked, as this will only widen in the cold and wet.

Other outdoor problems can include blockages with rubbish, which can cause flooding, along with potential plant damage. This can include small things like moss growing in cracks. This needs removing and the cracks filling in, as the process of freeze-thaw can widen these through the natural effects of expansion and contraction.

Larger vegetation problems can include trees, where it is important to check that there are no branches that might fall in inclement weather. Not only do these pose a threat to life, limb and property, but they may also be a visual irritant to neighbours. Root problems should also be dealt with, although only in an emergency should the tree be felled.

Alongside the risk of damp, cold is a key issue that will drive tenants away and put prospective new ones off. It is important to ensure the roof tiles are all in place and loft insulation is a good way of keeping heat in. On snowy days it is easy to tell which homes have this. While some have white roofs, others are clear of the stuff and may have birds perching on them to keep their feet warm.

Insulation is also something that should be fitted in cavity walls, unless the house lacks these. Insulating a home is not expensive and will help slash energy bills.

Draughts are another issue too. It is no use having insulation to stop heat escaping through the walls or roof if it has an easy way out through a gap at the bottom of the door, or a loose window fitting.

Having a home that is warm and well-insulated means less chance of burst water pipes, cold homes and those living within suffering from poor health. By keeping a home snug and warm, it will instead offer tenants a haven they will enjoy retreating to in winter and prevent expensive repair bills that could have been avoided with better preparation.

Article Source: http://www.stride.co.uk/insurance-news-and-articles/commercial-insurance-articles/property-insurance/landlords-are-you-ready-for-the-winter-/176/

Housing Market Boosts Confidence

This article of the Express on September 23th, 2013 reveals that the economy is now on its strongest levels because of the rise of market housing and jobs.

Consumer confidence in the economy has improved to its strongest levels in at least two-and-a-half years as optimism about the housing market and jobs rises, a report has found.

Sentiment towards the housing market is at its strongest since Lloyds Bank's Spending Power report began in November 2010, while worries about employment were also found to have eased.

Almost one fifth (18%) of people felt positive about the economy in August, showing a sharp increase from just over one in 10 (11%) in January. The proportion of people feeling negative about the economy fell to 31%, showing the lowest levels since research began.

These findings helped Lloyds' overall consumer sentiment index to rise to an all-time high of 115 points in August, marking a 10 point increase since the start of the year.

Patrick Foley, chief economist at Lloyds Bank, said the findings were "very encouraging". He continued: "Increasing consumer sentiment may in time embolden consumers to spend, so helping to underpin the wider economic recovery. In turn, such spending would further help improve the outlook for growth and jobs."

A new high of 39% of consumers were feeling positive about the housing market, which has recently seen a surge in activity following Government schemes such as Funding for Lending which have improved mortgage availability and led to some lenders offering their lowest ever rates.

House prices have also been back on an upward march in recent months, helping some home owners who have seen falls in the value of their property in recent years and who may have previously been stuck in negative equity.

People living in Northern Ireland, which has seen some particularly sharp drops in house prices before more recent signs that prices are stabilising, were the most likely to be downbeat about the housing market. Nearly three quarters (74%) of those surveyed in Northern Ireland said the housing market is "not good" or "not good at all", as did 72% of those in the North of England.

Meanwhile, negative feelings towards the employment market continued on a downward trend. Some 81% of consumers said the jobs market is "not good" or "not good at all", marking a decrease from 82% in July and 87% in May. Young people were the most likely to be upbeat about the employment market. More than one fifth (22%) described it as "somewhat good", compared with 16% of consumers generally.

People are also feeling less negative about how much money they will have in the coming months. The overall balance between those who feel they will have more money in the future minus those who predict they will have less was minus 3% in August, improving from minus 5% in July.

Article Source: http://www.express.co.uk/news/uk/431441/Housing-market-boosts-confidence

Tips to Increase the Value of Your Home

On this article by Express on September 20th, 2013 shows the different effective ways to increase the value of your property.

According to national estate agent Strutt & Parker the top five ways to increase the value of your home are as follows:

1. Room to Improve

Adding an extension is the most costly outlay but could increase the value of your home by up to 20 per cent.
2. Tap into Healthy Returns

The kitchen is the hub of the home. Creating a real asset by modernizing it can help you achieve your target asking price.
3. No Reason to Blow Hot and Cold

The prospect of upgrading a bathroom may deter some buyers but a new bathroom can be a prized asset.

4. Splash out on this Upgrade

Installing an en suite or wet room will increase the property’s appeal.
5. Appealing Aspects
An attractive garden has been proven to add value to a property. 

Article Source: http://www.express.co.uk/news/property/430774/Five-tips-to-increase-the-value-of-your-home

Average Property Price Sits at All-Time High of £257,000

This article by Lauren Everitt of EADT 24 on September 18th, 2013 shows that the property market is on its way to recovery with house prices on rise according to experts.

Property in the East of England now costs an average of £257,000 compared to £210,000 in July 2009 when the region felt the knock-on effects of the economic downturn.

Statistics from the Office for National Statistics (ONS) said a 1.4% rise in property prices from July 2012 to this July have helped increase the value of homes, surpassing the previous peak of £235,000 before the recession.

James Girling, director of Colin Girling & Company Ltd and PR representative for the Suffolk branch of the National Association of Estate Agents, said: “Since May the market has improved although it is still a buyer market.

“The Government talk about this ‘bubble’ but there isn’t one. Here in the east of the region we haven’t noticed this boom or bust scenario coming our way.

“It’s been a gradual increase of business and the first time buyers are coming through.
“The market is improving and we are optimistic but everything is two or three steps down from where it needs to be.

“The volume of activity is not where it was in 2006 and 2007 before it all went wrong.”
Michael Bedford, a partner at Bedfords in Aldeburgh, said the market has seen more activity.

“There has been more constant activity as well whereas there were peaks and troughs during the past few years,” he added.

“To many people’s surprise we had a record year in 2010 and this year has been as good but it’s too early to tell if it’s going to be better.”

However concerns have been raised that Government initiatives to kick-start the housing market such as Funding for Lending and Help to Buy are in danger of creating a property bubble, with borrowers over-stretching themselves as access to low-deposit deals returns.

Richard Sexton, director of e.surv chartered surveyors, warned that rising house prices threaten to price some people trying to get on the property ladder out of the market at a time when households are still under pressure from high inflation and stagnant wages.

He said: “If the Government wants to make housing more affordable - and avoid inflating another property bubble - then it needs to encourage more house building.”

Article Source: http://www.eadt.co.uk/news/east_of_england_average_property_price_sits_at_all_time_high_of_257_000_1_2643933

Rental Properties in the UK New Guidance on Adverts Are Issued

This article by the Property Wire on September 10th, 2013 reveals information relating to non refundable fees and tenancy charges in the UK's  residential lettings must now be displayed prominently on marketing and advertising material.


The Committee of Advertising Practice has published new advice which it has sent to all relevant trade bodies across the lettings sector following an Advertising Standards Authority ruling published in March 2013 in which it ruled against a letting agent which had not provided sufficient information about their fees in their online ads.

Residential lettings agents must now make changes to their websites and adverts placed on property portals and in other media and have until 01 November to do so.

‘We’ll be closely monitoring ads in all media from November onwards and will consider appropriate follow up action against non-compliant ads from this date,’ said the CAP.

The guidance comes after the CAP worked closely with bodies such as the Association of Residential Lettings Agents (ARLA) and The Property Ombudsman (TPO) as well as letting agents and private landlords to draw up the new requirements.

CAP has also published a new AdviceOnline, Compulsory costs and charges: Letting agents, for marketers to ensure that they comply with the rules.

Commenting on the CAP guidance, Caroline Kenny of the UK Association of Lettings Agents, said it should provide more clarity to letting agents on how to comply with the ASA ruling in March. ‘We have worked closely and consistently with the CAP and other industry colleagues since the ruling to ensure that any subsequent guidance is as clear and unambiguous as possible for letting agents to adhere to and it is encouraging to see that additional in depth advice regarding compliance,’ she pointed out.

‘We encourage all letting agents to review their property listings across all media platforms before the November compliance deadline in order to ensure they fall in line with the CAP’s guidance,’ she added.

The ASA ruling in March related to property firm Your-move.co.uk Limited which was told to ensure that their adverts make clear when non-optional fees and charges, that could not be calculated in advance, were excluded from quoted prices, and to provide enough information to allow the consumer to establish easily how further charges would be calculated.

The Royal Institution of Chartered Surveyors (RIVS) is also encouraging its members to familiarize themselves with the CAP guidance and to take action to ensure their businesses are compliant with the new requirements.

It pointed out that the CAP guidance articulates what compliance looks like for adverts in different media, with further help and advice available via the CAP copy advice team. 

Article Source: http://www.propertywire.com/news/europe/uk-rental-property-guidance-201309118223.html

Buy-to-let Mortgage Market is Prospering

According to a report by Landlord Today a large number of buy-to-let market is booming as shown in this article by propertysecrets on September 16th, 2013.

The latest figures from the Council of Mortgage Lenders show strong growth in the buy-to-let market report Landlord Today.

15,200 BTL loans were advanced in July, an increase of 12% compared to June. This represents a value of £2bn which was 11% higher than in June.

Lending for BTL house purchase was up 7% in July compared to June, a total of 7,600 loans. The value of these loans was £900m, up 13% from June.

There was strong growth in BTL remortgage lending which increased by 24% in July compared to June, a value of £1.1bn. This equated to 7,200 loans in July for BTL remortgage in total, an increase by 13.4% on June 2013.

The figures come just a week after a survey by the Royal Institution of Chartered Surveyors (RICS) showed that house prices are rising at their fastest pace for almost seven years. Many pundits are predicting that the introduction of Help to Buy could lead to another house price bubble.

Stephen Johnson, managing director of commercial mortgages at Shawbrook Bank, said: "The announcement of the rise in buy-to-let lending is great news for the industry and Shawbrook is keen to support professional investors looking to take advantage of these market conditions.

"However, as an industry we must be careful to not create another bubble. At the moment lending conditions are very good but these are unusual times and the UK needs to create a sustainable market, not one lurching from peak to trough. Those looking to buy property need to ensure they look at the long term - investors need a portfolio that can still work in a more normalised interest rate environment. Sensible gearing will maximize returns, over-gearing now could potentially put at risk investors' hard-earned equity."

Article Source: http://www.propertysecrets.net/article/buytolet_mortgage_market_booming/3115.html

Buying into Britain

This interesting article by Chen Dujuan of Global Times on September 15th, 2013 shows the milestone of Chinese investment in Great Britain.

Two years ago, the BBC made a TV documentary called "The Chinese are coming," focusing on growing Chinese investment in Africa and South America. Now, the Chinese are coming again, but this time to the home country of the BBC: Britain.

Many of the country's well-known brands have been either wholly acquired or bought into by Chinese firms, including Weetabix, Thames Water and Heathrow Airport.

"There are around 500 Chinese companies currently investing in Britain and taking advantage of the world's most open investment environment. We welcome more," Daniel Carvalho, China marketing and communications manager with the UK Trade & Investment Office at the British Embassy in Beijing, told the Global Times on Tuesday.

"I think we're seeing the beginning of a very strong trend of Chinese investment into the UK," Carvalho said.

Chinese investment in Britain reached $8 billion in 2012, more than the total from 2009 to 2011, with domestic firms expanding into areas such as high-end manufacturing, infrastructure and research, the Chinese Embassy in London said in January.

From the beginning of 2013 to early August, China has invested more than $2 billion yuan in the country, Zhou Xiaoming, minister counselor for commerce at the Chinese Embassy in Britain, was quoted as saying by the 21st Century Business Herald on August 10.

Zhou said that Chinese firms will announce new infrastructure investment worth hundreds of millions of pounds in Britain in September, the report said.

Desirable sectors 
China has made breakthroughs in infrastructure investment in Britain in recent years, partly due to local preferential policies.

In 2012, China's sovereign wealth fund China Investment Corp bought an 8.68 percent stake in Kemble, which controls Thames Water, and acquired a 10 percent stake in Heathrow Airport.

Gingko Tree Investment Ltd, a fund wholly owned by China's State Administration of Foreign Exchange, also invested in a British water utility company last year.

Companies owned by Hong Kong billionaire Li Ka-shing control 30 percent of Britain's power supply, as well as 25 percent of its natural gas and 7 percent of the water supply.

Property is another new area of interest for Chinese investors.

In July, Ping An Insurance Group bought London's landmark Lloyd's building for 260 million pounds ($411 million). 

Dalian Wanda Group in June spent around 700 million pounds to develop a real estate project in London, including two apartment buildings and a five-star luxury Wanda hotel.

In May, Beijing-based property developer Advanced Business Park signed a $1.5 billion deal with London's city government to develop Royal Albert Dock.

Wang Jianlin, chairman of Dalian Wanda, told the Beijing News in June that the real estate project is "a big bargain for Wanda," which partly explains these firms' enthusiasm for property in Britain.

The land price for the project is much cheaper than in Beijing, and the sales revenue will be far more than the investment costs, Wang said.

Frank Chen, head of research at the China office of commercial property services company CBRE, told the Global Times Tuesday that the amount of high-quality property available for investment in Asia Pacific is still limited compared with North America and Europe, so Chinese investors are expected to focus on property in gateway cities that are capable of generating reliably stable returns on investment.

Chinese companies have also shown interest in buying high-end manufacturing brands in Britain and setting up R&D centers there.

Wanda acquired a 91.81 percent stake in British yacht maker Sunseeker in June and Chinese automaker Geely bought black cab manufacturer Manganese Bronze in February.

Companies including Shanghai Automobile and Huawei Technologies have set up or expanded research centers in the country.

Local benefits
"The British economy is growing again after several years of stagnation, so the timing is right for Chinese investors," Qing Wang, professor of marketing and innovation at Warwick Business School in Britain, told the Global Times Wednesday.

She said that Britain's sound legal system and open economy as well as the status of London as an international finance and services center make the country an attractive destination in Europe for Chinese investors.

Preferential policies are also playing an important role. Britain has chosen an "open door" philosophy to foreign investment in almost all of its industrial sectors, Michele Geraci, head of research at the Global Policy Institute, a think tank under the London Metropolitan University, told the Global Times Wednesday.

"We want to be the destination for Chinese investment. Tell other Chinese investors to come to London and spend their money," British Prime Minister David Cameron told Fortune magazine in May.

Chinese companies will be made to feel welcome, and will receive the full support of the British government, the British Embassy's Carvalho said.

A competitive tax regime and highly skilled workers are Britain's other advantages, Carvalho said. "We have hundreds of billions of foreign investment in Britain, so we're used to it. It's how our economy works - we accept investment from overseas, and we also make huge investments around the world ourselves," he noted.

Wang said that both governments have set a target to boost bilateral trade, and that the two countries can combine complementary assets and competencies, offering huge potential for Chinese firms investing in Britain.

Foreign owners welcome
Qing Wang and Michele Geraci both agreed that British people are not too concerned about local firms being bought by foreign investors, so long as it brings more employment to the country.

Chinese companies that wish to invest in the UK should be prepared to be more transparent about their shareholding structure, so that the sellers know exactly who is buying their assets, Geraci said.

Carvalho suggested that foreign investors should have "a PR strategy to engage with the UK media and local communities to build trust and gain confidence." The British Embassy can offer advice on this, he noted.

It is important that Chinese firms understand and abide by the rules and regulations of the British legal and economic system, Wang said, expressing the hope that Chinese firms can develop innovative products and global brands through investing in Britain.

Zhou with the Chinese Embassy in Britain suggested that Chinese firms could take advantage of the innovative advantages in Britain and cultivate their brands there, the 21st Century Business Herald report said.

Zhou said that the eurozone crisis has offered advantageous timing for Chinese companies, which can depend upon Britain's status as an international center and its open environment to expand into the international market, according to the report.

Article Source: http://www.globaltimes.cn/content/811462.shtml#.UjZiRT_tYh8

U.K. House Prices Increase to Record on London Property Surge

This article by Fergal O’Brien of BloombergBusinessweek on September 12th, 2013 reveals the increase of house prices in the UK and property market in London continued to soar.

U.K. house prices rose to a record last month as government measures boosted demand and London’s property market continued to surge, Acadametrics said. 

Values increased 0.4 percent from July to an average 233,776 pounds ($370,000), the London-based real-estate researcher and LSL Property Services Plc said in a report today. In London, prices have risen 40 percent from their peak in April 2009, compared with 16 percent nationally.

The Bank of England-run Funding for Lending Scheme has helped to cut mortgage costs, while Chancellor of the Exchequer George Osborne’s Help to Buy program allows people to purchase a home with a deposit of as little as 5 percent of the value of the property. The BOE has downplayed speculation that a bubble may be brewing, saying activity is still at a low level relative to its pre-crisis peak.

“The property market has turned over a new leaf after years of restrained activity,” said Richard Sexton, director LSL unit e.surv. “The government has been pivotal in providing the aid that the market has been craving for many years.”

Eight of the 10 regions tracked by LSL recorded price gains in the latest three months compared with a year earlier. In the southwest and Wales, where values fell, the declines eased, according to the report.

Acadametrics estimates that completed housing transactions exceeded 70,000 in August for a second month. That would mark the first time that sales over two consecutive months have been above that level since November-December 2007, when transactions were 104,486 and 84,524.

BOE Governor Mark Carney said yesterday that while the market is improving, activity levels, mortgage applications and valuations are still low. He also said prices will continue to increase and the Financial Policy Committee of the central bank will be “vigilant.”

“It is still too early to predict what impact the economy will have on prices, especially as the FPC may apply downward pressure through controls over mortgage supply and pricing,” Sexton said. “Thus nothing can be set in stone yet.”

To contact the reporter on this story: Fergal O’Brien in London at fobrien@bloomberg.net

Article Source: http://www.businessweek.com/news/2013-09-12/u-dot-k-dot-house-prices-increase-to-record-on-london-property-surge

England Needs More New Homes Than Previously Estimated

According to the new analysis England needs news homes a year are needed because of its increasing demand as shown on this article by the Property Wire on September 11th, 2013.

An analysis of Census information for England shows that over 240,000 new homes a year are needed as demand continues to significantly outstrip supply.
 
The analysis by housing academic Dr Alan Holmans published by housing and planning charity, the Town and Country Planning Association (TCPA), shows that the scale of housing need is greater than currently estimated.

Holmans, from the Cambridge Centre for Housing and Planning Research, says in the report that housing requirements are on average around 240,000 to 245,000 per year, with around 60% of all demand and need in the four southern regions of England.

This is up to 10,000 more homes per year than the generally used 235,000 figure. The report also shows that house building levels are slowing rising from their lowest levels since the 1920s, at around 100,000 per year.

‘This research, the first of its kind to analyse the Census 2011 data, is a crucial reminder of the desperate need for more and better housing in the right places. We have a hopelessly inadequate supply of housing and a serious backlog, as well as chronic affordability problems,’ said Kate Henderson, TCPA chief executive.

‘While house building levels remain at about 100,000 per year, the Census reveals a staggering need for over 240,000 homes per year. The research also shows that nearly one third of newly arising housing need requires some subsidy; without this investment affordability, overcrowding and ultimately homelessness will worsen,’ she added.

‘We urgently need a new vision for housing and the development of new communities. That new vision has to ensure a substantial increase in the supply of new homes and address affordability. At the same time, we must focus on building successful new communities, whether as part of urban regeneration or through new Garden Cities. This is essential not just to our economic future but also the social and environmental wellbeing of our country,’ she added.

The figures make projections for 2021 and extend them to 2031 to enable longer term decisions for land use management, planning and local government. The projections in the report, together with adjustments for gains, losses and vacancies in stock, suggest that over 240,000 additional homes will be required to meet newly arising demand and need.

The report says that even if the economy remains depressed and household formation rates remain low, there will still be almost a 20% increase in the number of households over the 20 year period to 2031. This is mainly because of the expected continued growth in population.

It also shows that there was an abrupt break with longer term trends in household formation in England between 2001 and 2011. To take the most obvious example, the number of one person households in 2011 according to the Census was nearly one million lower than the 2008 based projections published by the Department of Communities and Local Government in 2011.

Other large scale shifts in the mix of household types include far more couple plus other adult households than expected. In part this is about younger people staying at home or sharing accommodation for longer. But that is not the whole story as changes are observed in all age groups.

Applying past trends based mainly on household composition would suggest that some 68% of new households would be in the market sector of owner occupation or private market renting without benefits, but that housing to meet nearly one third of newly arising need would require some subsidy.

At the regional level, not far short of a quarter of all housing demand and need is likely to be concentrated in London, with over 60% in the four southern regions. But all regions require significant additional housing investment.

‘It is enormously important that we plan for recovery and deliver much higher output levels. Otherwise if recovery happens increasing house prices will worsen affordability. Planning based on the past few years of recession will simply build in the next crisis,’ said Professor Christine Whitehead, who was involved in the research that lies behind the report.

Chris Tinker, board director at home builders Crest Nicholson, which supported the research, said that the study re affirms the on going need for over 240,000 new homes per annum, 60% of which is required in London and the four main Southern regions.

‘With developer's consented land banks amounting to less than two year's housing demand there is therefore an urgent need for Local Authorities and developers to work together, especially in key demand areas, to identify and plan for a significant increase in new communities within which well designed homes can be delivered. A failure to meet housing demand will continue to undermine affordability and put the future prosperity and success of our communities at risk,’ he added.

Article Source: http://www.propertywire.com/news/europe/england-house-building-analysis-201309118222.html

A Quarter of All Homes Sold to First Time Buyers

According to this latest article by Alex Johnson of The Independent on September 10th, 2013 NAEA figures show around 26% home sales were sold to first-time buyers.

Around 26% of home sales in August were by first time buyers, according to figures from the National Association of Estate Agents (NAEA), the highest proportion since July 2010 and up from 22% in July.

NAEA members also reported an increase of 29% in the average number of house hunters per branch, up from 250 in July to 322 in August, as well as a slight increase in the average sales agreed per branch in August (nine) compared with July (eight). However, supply levels dropped slightly over the month – the number of available properties per branch decreased from 53 in July to 52 in August.

Around 40% of home buyers last month were aged between 41 and 55 years old, followed by 31 to 40 year olds at 36 per cent. Nearly eight out of ten properties were sold to couples.

Five thousand Lanarkshire homes set to receive green energy

Muirhall Energy has secured a £9million finance package from Santander to expand the Muirhall Windfarm in South Lanarkshire. It is adding two new turbines to the site, the tallest in the UK, to increase production to 60,800 MWh per year, enough to power over 14,300 homes each year. This will prevent 26,144 tonnes of carbon dioxide emissions each year.

Chris Walker, Managing Director of Muirhall Energy, said: “As demand for power increases and fossil fuel reserves deplete it is important we continue make the most of alternative sources of energy and wind power continues to be one of the most cost effective and green solutions.”

Lack of rental homes for families on the market

Figures from Countrywide show that two and three bedroom rental properties saw an increase in average monthly rents in August, up 0.6% and 0.9% respectively. One and four-plus bedroom properties saw a drop of 0.1% and 1.6% respectively. Nick Dunning, Group Commercial Director at Countrywide, said: “August is traditionally a busy period for the rental market with tenants, particularly families, wanting to move into their new rented accommodation before the start of the school term in September. However, demand is not being met by supply and currently there is a particular lack of family-sized properties available to rent, especially in the South of England. Improved conditions in the sales market are attracting reluctant landlords to sell these types of properties specifically in the catchment areas for good schools.”

Property prices in Surrey

According to Zoopla the property prices in Surrey are up 7.35% from five years ago and 4.12% from a year ago. James Wyatt, Partner of Barton Wyatt and Chairman of NAEA Surrey, said: “These figures point to the change in attitude of the money lenders in the last there months. Yet again financial institutions are driving the market and the recent decisions which enables UK buyers to borrow money more easily again has positively turned the market. This has aided sales in the small to medium sized end of the market as most of these properties are purchased with mortgages and in turn we have seen a 33% increase in domestic buyers over the past year in north Surrey.”

Article Source:  http://blogs.independent.co.uk/2013/09/10/a-quarter-of-all-homes-sold-to-first-time-buyers/

Who is the Typical First Time Buyer?

This article by Alex Johnson of The Independent on September 9th, 2013 basically identifies the percentage of the typical first time buyer according to age, salary, house type, property value, etc.

According to the latest figures from LSL Property Services, the average first-time buyer in
July was aged 30, with an annual salary of £36,299, 4 per cent higher than in July 2012.

The average purchase price for a first-time buyer rose by 8 per cent year-on-year in July, and is now £146,726.

The number of first-time buyers who were able to self-fund their purchase fell to 41 per cent in July, from 51 per cent in April. Around 36 per cent of all first-time buyers in the UK received financial help with their deposit from parents or relatives, while 9 per cent benefited from an inheritance - 2% received family help with mortgage repayments. Another 4 per cent received financial help from a government scheme such as Help to Buy, up from 1 per cent in April.

A total of 44 per cent of all first-timers were looking for houses with three or more bedrooms.

The second most popular property type was two bedroom houses (31 per cent). Flats continued to attract far fewer first-time buyers with just a quarter of buyers looking for flats rather than houses.

Four in ten first-time buyers said they were choosing to buy now as they had only recently been in  a position financially stable enough to purchase a property, while a quarter chose to buy to own a house with their partner, and another quarter feel it is time for them to settle down. Only 8 per cent bought for investment purposes,  expecting house prices to rise, down from 11 per cent in April.

First-time buyers are also confident that the value of property is set to rise. Almost half  of UK first-time buyers think that house prices will rise by up to 5 per cent in the next year, while a further two in ten believe prices will rise between 5 per cent and 10 per cent.

Connells also reported that the number of first-time buyers in August 2013 outpaced those recorded in August 2007. There were 40% more first-time buyers last month than in August 2012 and 1% more than August 2007.

John Bagshaw, Corporate Services Director of Connells Survey & Valuation, comments:

"Numbers of first-time buyers are flowing again, but it isn’t like the floodgates have been thrown open for everyone.  There are still thousands of households whose earnings have little chance of matching inflation – let alone being sufficient to support loans based on current house prices.  The other side of the story to first-time buyers are those still renting, and buy-to-let activity is still growing at an astounding pace to keep up with demand for renting."

In the LSL survey, tenants currently unable to become first-time buyers named the inability to save for a deposit as the biggest stumbling block to homeownership. More than half are unable to buy as they can’t save for a deposit, and a growing number of potential first-time buyers (19according to chartered surveyors Connells Survey & Valuation) are concerned that rising costs like stamp duty will get in the way, up by a third from 13according to chartered surveyors Connells Survey & Valuation in December 2012.

David Newnes continues: “It remains a huge challenge for first-time buyers to purchase property in the capital. House prices are more expensive, and the size of deposit required dwarfs that in the rest of the country. It’s the reason why six out of tenants in London can’t afford to buy. And there are further concerns for the London market. Higher legal fees and stamp duty costs are turning further first-timers off buying."

Article Source: http://www.independent.co.uk/property/who-is-the-typical-first-time-buyer-8804580.html

House Prices Rising at Their Fastest Rate for 3 Years

According to these data and figures from Halifax the average property shot by 5.4% in the three months to August compared with the same time last year as shown  on this article by Mirror on September 7th, 2013.

House prices are rising at their fastest rate for three years, new figures have revealed.

Data from the Halifax showed the average property shot up by 5.4% in the three months to August, compared with the same time last year.

Prices rose by 0.4% in August alone – the seventh consecutive monthly rise, leaving the average home worth £170,231.

Experts say the pick-up in property prices has been fuelled by a flood of cheap finance, boosted by the Bank of England’s Funding for Lending scheme and the Government’s Help to Buy initiative.

Rock-bottom mortgage rates led to a 45% jump in first-time buyers in July, a report earlier this week found.

But critics warn the latest leap in prices is creating another housing bubble that is excluding many people from the property market and lumbering borrowers with large debts.

Halifax housing economist Martin Ellis said: “Overall, house prices are expected to rise gradually over the remainder of the year.”

Halifax’s report follows similar findings from building society Nationwide last week that the housing market revival is gathering pace.

Bank of England governor Mark Carney recently addressed concerns that Government stimulus ­measures risk stoking another property bubble. He said the Bank is “acutely aware” of the potential threats and said action will be taken to clamp down on mortgage lending if needed.

Matthew Pointon, property expert at Capital Economics, said the imbalance between demand and the supply of homes for sale is likely to subside gradually, which will reduce the upwards pressure on prices.

He added: “The rise in wholesale interest rates seen over the past few weeks may soon start to feed through to mortgage rates, dampening demand.”

Comment by Campbell Robb, Chief Executive, Shelter

Some people might cheer as house prices rise again, but not England’s 1.8 million forgotten families.

That’s the number of working families in this country who are taking home between £20,000 and £40,000 – but are still priced out of a reasonable home of their own.

In the past, they would have been able to put down roots in a home they own or in social housing.

But now, their reality is often expensive private renting, where they can find themselves trapped on a merry-go-round of one six-month tenancy to the next. Shelter’s advisers see families like this every single day.

Many simply won’t be able to afford high monthly mortgage payments, thanks to rising house prices.

And Government mortgage guarantees won’t help – because it means borrowing more, and paying higher costs each month.

The root of the problem is that we need more homes that people can afford.

Until we do, the simple laws of supply and demand will keep pushing prices higher.

If we want to give hope to forgotten families, celebrating high house prices won’t help. We need to build more homes.

Article Source: http://www.mirror.co.uk/money/personal-finance/house-prices-rising-fastest-rate-2257130

Adult Children Live with Their Parents at Home as Rents and House Prices Rise

This alarming article by Tanya Powley of Financial Times on September 6th, 2013 reveals grown-up children are still living at home with their parents because getting on to the property ladder is increasingly difficult as rents and house prices rise.

“Empty nest” syndrome has become a problem of the past for millions of parents who have adult children in their twenties and early thirties still living at home.

The trend of young adults returning to live in the parental home – generation boomerang as they have been called – has grown in recent years, as rents and house prices have risen further out of the reach of would-be homeowners.

Three in ten parents have at least one child aged between 21 and 40 living at home, according to a survey published by the National Housing Federation on Friday. Two-thirds of these parents said their child could not afford to move out.

The poll, which surveyed more than 1,100 parents, highlighted the emotional and financial burden parents face and why the returning offspring have been given another nickname: Kippers – kids in parents’ pockets eroding retirement savings.

One in five said having a grown-up child at home had caused them stress, while a further fifth said it had given rise to family arguments.

“Moving out and setting up a family home of your own is a normal rite of passage,” said David Orr, chief executive at the National Housing Federation. “Yet as rents, mortgages and deposits continue to soar out of reach, it is no longer an option for many.”

Official figures show the number of young adults living at home has jumped by 20 per cent since 1997. According to the Office for National Statistics, almost 3m Britons between the age of 20 and 34 now live at home – of which 1.8m are men.

Amanda Lightstone, a 57-year-old dental nurse, has her youngest son, Andrew, 25, living with her in her three-bedroom house in Edgware, northwest London. She has already lent more than £100,000 to her older sons to help them buy their homes and said she will do the same for her youngest.

“How will he save for a deposit if he starts renting? He will live at home for quite a few years – he’ll be more than 30 when he can afford to buy his own place. I will just have to delay my retirement plans, you can’t have everything!” said Ms Lightstone.

Ann Berrington, professor of demography at the University of Southampton, said the percentage of young adults in their twenties living with their parents has increased since the recession.

Her analysis of the 2008 and 2012 UK Labour Force Surveys found the percentage of women aged between 21 and 22 living at the parental home rose from 46.4 per cent to 55.6 in the four years to 2012.

“The lack of affordable housing is clearly a factor as well as having to raise bigger deposits, but there are other factors at play,” said Professor Berrington.

While research published on Friday showed that in July the number of first-time buyers was at its highest since November 2007, according to LSL Property Services, transaction levels are still significantly lower than at the peak of the housing market.

Local government department figures published on Thursday showed that the government’s housing schemes, which aim to make it easier for people to buy a home with just a 5 per cent deposit, have made little headway.

According to the government, 3,749 people have bought a home through its NewBuy scheme launched in March 2012. This equates to less than 5 per cent of its 100,000 target. The second part of the scheme has had a bigger impact, with 3,000 sales and 10,000 reservations since April 2013.

Paula Higgins, chief executive of the HomeOwners Alliance, said: “We haven’t been building enough houses for 30 years and this is a real embedded crisis that’s not going to go away.”

Article Source:  http://www.ft.com/intl/cms/s/0/eb71071c-163e-11e3-a57d-00144feabdc0.html#axzz2e596ach1

Almost 2 Million UK Would Be Homeowners Can’t Get on Property Ladder

New research suggests that almost two million would be homeowners in the UK, mostly families, can't get on the property ladder because they can't afford to save for the deposit needed, according to this September 4th, 2013 recent article by the Property Wire.

According to housing charity Shelter around 1.8 million families face a life time of renting a home with three quarter priced out of the market and even with the government’s flagship Help to Buy scheme some 78% are unable to afford the repayments on a family sized home.

In contrast, the report finds that mortgage repayments on a shared ownership home would be affordable for 95% of families on low or middle incomes.

The charity is calling for a major new house building programme of shared ownership homes to revolutionise ownership for what is describes as ‘forgotten families’. This would allow families to find an affordable home of their own, and provide a real alternative to the confusing postcode lottery of existing small scale schemes, or the overheated private rental market.

The report says that investing £12 billion, less than 1% of GDP, could build 600,000 new shared ownership homes which would be enough to give almost half of England’s private renting families the chance to own their own home. 

‘We need to see a new generation of shared ownership for the ordinary families priced out of home ownership. The reality is that soaring house prices mean that the traditional market is no longer working for ordinary people,’ said Kay Boycott, director of campaigns and policy at Shelter.

‘Building the new shared ownership homes we desperately need is the only way to give thousands of families a stake in the stable home they want at a price they can afford,’ she added.

But the government says it is doing more to help families onto the housing ladder. As well as schemes like Help to Buy and Funding for Lending, both credited with boosting the number of first time buyers, it points to the fact that it has also launched a new scheme to bring back empty homes into the housing stock.

It is working with the public and private sector through the National Empty Homes Loan Fund (NEHLF) to give borrowers access to a secured loan at a fixed 5% interest to renovate some of the 710,000 empty homes in England.

A joint £3 million initiative has been launched with the charity Empty Homes, the Ecology Building Society and 39 participating local authorities to help home owners who cannot afford to bring the property up to a useable standard.

The Ecology Building Society, a specialist mortgage lender that supports sustainable communities, said that it should provide funding for hundreds of properties and is available to individuals aged 18 and over who own a property that has been empty for six months or more. 

‘We know that many homes are empty because it is difficult for owners to raise the money that is required to bring them back up to a habitable standard. This initiative will kick start efforts to tackle this. This scheme is a first in England and is a great example of central government working together with the public and private sector to try and reduce the number of empty homes in the UK,’ said David Ireland, chief executive of Empty Homes.

Paul Ellis, chief executive of the Ecology Building Society, said that at a time when there is increasing demand for homes but an acute lack of supply it makes sense to bring new life to existing but neglected properties.

Article Source:  http://www.propertywire.com/news/europe/uk-property-ladder-families-201309048193.html

Prices on Climb Amid Strongest Market Conditions for Six Years in UK

The market is in its best shape since the financial crisis as demand continues to outpace the number of homes for sale, adding to values, according to this recent article by South China Morning Post on September 4th, 2013.

British house price growth accelerated last month amid the strongest market conditions for six years as demand continued to outpace the number of homes for sale, Hometrack said.

Average values in England and Wales rose 0.4 per cent after a 0.3 per cent gain in July, the London-based property researcher said. Prices were up 1.8 per cent from a year earlier, the most since July 2010.

In a separate report, the Engineering Employers' Federation raised its forecasts for UK economic growth and manufacturing output.

Hometrack's survey adds to evidence of a mini-boom in the housing market, with reports last week showing values rising and mortgage approvals at their highest since 2008.

Bank of England Governor Mark Carney said he was alert to risks from the property market and policymakers would act if signs of a bubble emerged.

Richard Donnell, director of research at Hometrack, said: "A lack of housing for sale is set to remain a feature of the market and this will keep an upward pressure on prices in the near term.

"We expect demand to continue to expand over the remainder of the year so long as the outlook for the economy and mortgage rates remains unchanged."

Underlying market conditions are at levels not seen since the financial crisis, with the average time taken to sell a property falling to 8.1 weeks and sellers achieving 94.6 per cent of the price sought last month, Hometrack reported.

New buyers registering with real estate agents to browse property rose 1.1 per cent, the same as in July. Demand fell in August in each of the last three years. Growth in new property listings slowed to 0.8 per cent from 2.4 per cent.

Seven of the 10 regions tracked by Hometrack showed price gains, led by a 0.9 per cent increase in London. Two regions showed no change while values dropped 0.1 per cent in the northeast.

Signs of economic growth have lifted consumer confidence. The economy expanded 0.7 per cent in the second quarter, and recent data suggests the recovery is gaining traction.

A survey by the manufacturers' organisation EEF and the accounting firm BDO showed manufacturing output rose to a three-year high in the third quarter, with a gauge of production rising to 32 from 12.

A measure of investment intentions rose to 24, the highest in six years.

The group raised its forecast for manufacturing growth next year to 2.1 per cent from 1.9 per cent, following a 0.5 per cent contraction this year.

It also raised its forecast for UK gross domestic product growth to 1.2 per cent this year and 2 per cent next year, versus earlier projections of 1.1 per cent and 1.8 per cent.

"Industry's prospects have brightened considerably," said Lee Hopley, chief economist at the EEF. "There is growing confidence that improving trading conditions will continue into the final months of this year and then accelerate through the gears in 2014."

Nationwide Building Society said last week that home prices rose 0.6 per cent last month and the Bank of England's commitment to maintain record-low interest rates until at least the end of 2016 may be helping to support demand.

Article Source: http://www.scmp.com/property/international/article/1302634/prices-climb-amid-strongest-market-conditions-six-years-uk