Posts Tagged ‘still’

Property market in Dubai stabilises but still declining in Abu Dhabi

March 23, 2017

Property market in Dubai stabilises but still declining in Abu Dhabi

The residential real estate market in Dubai is showing signs of having bottomed out with the latest sales and price figures moving into positive territory in February.

The Dubai residential property sales price index from ReidIn increased by 0.3 points, an increase of 0.10% month on month and prices are now 0.97% higher year on year.

Apartment prices rose by 0.12% month on month and 1.06% year on year while villa prices were up 0.06% month on month and 0.59% year on year.

But rents are still falling. The rental price index decreased by 0.8 points with rents down 0.9% month on month and down 3.69% compared to February 2016.

Apartment rents fell by 1.04% month on month and 2.89% year on year while villa rents were down 0.1% month on month and 7.86% year on year.

In neighbouring Abu Dhabi the property market is still declining. The ReidIn price index fell by 0.9 points with prices down 1.18% month on month and 6.23% year on year.

A breakdown of the figures show that in Abu Dhabi prices for apartments fell by 1.12% month on month and 5.86% year on year while villa prices decreased by 1.31% on a monthly basis and 7.39% annually.

In the lettings sector the rental index decreased by 0.7 points with rents down 1.16% in February compared to January 2017 and down 8.59% year on year.

Apartment rents fell by 1.3% month on month and 9.81% year on year while villa rents were down 0.82% month on month and 4.81% year on year.

Meanwhile, a new analysis shows that Dubai real estate assets have given a 120% return to investors in the 10 years since the global financial crisis. As a result of the crisis many projects in Dubai stalled or were cancelled.

But now the property market in the emirate is recovering having been boosted by a number of Government investments and the awarding of Expo 2020 to Dubai, says the ReidIn Global Capital Partners report.

The 120% return compares to 75% in London and 63% in New York and the report explains that the bulk of the returns in Dubai have been through rental increases.

‘Dubai has become a magnet for international investors for real estate, and monetary inflows have continued to increase steadily over the last decade,’ it concludes.

Total mortgage lending in UK still affected by weakness in buy to let

March 23, 2017

Total mortgage lending in UK still affected by weakness in buy to let

Gross mortgage lending in the UK reached £18.2 billion in February, down 8% on January’s lending total of £19.8 billion but not far from the £18.1 billion lent in February last year.

The figures from the latest market report from the Council of Mortgage Lenders, which represents the vast majority of home lenders in the country, suggest that current weaknesses are likely to continue.

‘Mortgage lending is holding up well, but under the surface buyers face mixed fortunes. First time buyers and customers who are remortgaging are driving total lending, while home movers and buy to let remain weak,’ said CML senior economist Mohammad Jamei.

‘The weakness in home movers means few properties are coming onto the market for sale, which is aggravating a supply demand imbalance that has characterised the market since late 2013. This looks set to continue at least over the next few months, posing an obstacle for would-be borrowers,’ he added.

Henry Woodcock, principal mortgage consultant at IRESS, expects the market to pick up a bit in March, traditionally the start of the busy spring buying season. ‘There was no stimulus to housing provided in the Spring Budget, and forecasts by estate agents indicate that the number of home transactions completed will fall % this year,’ he said.

‘However, I still expect March gross lending to be slightly higher than February, although it will not reach the heady height of 2016 which was driven to a great extent by impending buy to let changes,’ he explained.

‘Of course, one thing could change this. The recent jump in inflation to 2.3% is the first above target rise since November 2013. No doubt this will put some pressure on the Bank of England’s Monetary Policy Committee (MPC) to start considering interest rate rises,’ he pointed out.

‘If that were to happen it would obviously mean higher monthly payments for people on tracker and variable mortgages, and lenders would react quickly to pull some of the very cheap mortgage deals. It wouldn’t surprise me if we see an unusually higher spike in mortgage activity over the coming months as people look to secure the best deals while they’re still available,’ he added.

John Eastgate, sales and marketing director of OneSavings Bank, pointed out that a nine year high for gross mortgage lending in January proved that mortgage demand is effervescent. ‘But given the record highs, some moderation was to be expected and is arguably welcomed. The Brexit effect and the base rate cut have driven mortgage rates to all-time lows, supporting mortgage activity, most prominently in remortgaging,’ he said.

‘While buy to let purchases have seen a dip since the changes to stamp duty costs last year, the sector has also seen a surge in demand from landlords refinancing to take advantage of low rates to reduce their costs. We should expect to see remortgage activity continue to drive lending levels in 2017 as a lack of supply and stretched affordability, will continue to subdue the purchase market,’ he added.

Total mortgage lending in UK still affected by weakness in buy to let

March 23, 2017

Total mortgage lending in UK still affected by weakness in buy to let

Gross mortgage lending in the UK reached £18.2 billion in February, down 8% on January’s lending total of £19.8 billion but not far from the £18.1 billion lent in February last year.

The figures from the latest market report from the Council of Mortgage Lenders, which represents the vast majority of home lenders in the country, suggest that current weaknesses are likely to continue.

‘Mortgage lending is holding up well, but under the surface buyers face mixed fortunes. First time buyers and customers who are remortgaging are driving total lending, while home movers and buy to let remain weak,’ said CML senior economist Mohammad Jamei.

‘The weakness in home movers means few properties are coming onto the market for sale, which is aggravating a supply demand imbalance that has characterised the market since late 2013. This looks set to continue at least over the next few months, posing an obstacle for would-be borrowers,’ he added.

Henry Woodcock, principal mortgage consultant at IRESS, expects the market to pick up a bit in March, traditionally the start of the busy spring buying season. ‘There was no stimulus to housing provided in the Spring Budget, and forecasts by estate agents indicate that the number of home transactions completed will fall % this year,’ he said.

‘However, I still expect March gross lending to be slightly higher than February, although it will not reach the heady height of 2016 which was driven to a great extent by impending buy to let changes,’ he explained.

‘Of course, one thing could change this. The recent jump in inflation to 2.3% is the first above target rise since November 2013. No doubt this will put some pressure on the Bank of England’s Monetary Policy Committee (MPC) to start considering interest rate rises,’ he pointed out.

‘If that were to happen it would obviously mean higher monthly payments for people on tracker and variable mortgages, and lenders would react quickly to pull some of the very cheap mortgage deals. It wouldn’t surprise me if we see an unusually higher spike in mortgage activity over the coming months as people look to secure the best deals while they’re still available,’ he added.

John Eastgate, sales and marketing director of OneSavings Bank, pointed out that a nine year high for gross mortgage lending in January proved that mortgage demand is effervescent. ‘But given the record highs, some moderation was to be expected and is arguably welcomed. The Brexit effect and the base rate cut have driven mortgage rates to all-time lows, supporting mortgage activity, most prominently in remortgaging,’ he said.

‘While buy to let purchases have seen a dip since the changes to stamp duty costs last year, the sector has also seen a surge in demand from landlords refinancing to take advantage of low rates to reduce their costs. We should expect to see remortgage activity continue to drive lending levels in 2017 as a lack of supply and stretched affordability, will continue to subdue the purchase market,’ he added.
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