The number of new properties being built is increasing but they are still way below what they were a year ago and the situation is set to result in severe shortages in years to come.

The latest figures from the NHBC show that private sector starts are 36% on a year ago although they have reached the highest point in almost a year.

The warranty and insurance provider received 8,305 applications in June 2009 for builders to start new properties in the combined private and public sectors, the greatest number since July 2008, when 9,530 applications were received. However, private sector new starts (excluding housing associations) were down 36% on the same three-month period a year ago (20,973).

There is a significant fluctuation in the number of applications across the UK, with figures for some regions, including Greater London and Merseyside, more than 50% down on a year ago.

A shortage of new build housing will emerge particularly in the South East of England next year, according to the latest Knight Frank residential development review.

New build starts in the region this year are likely to amount to the lowest since the 1950s. When combined with the lack of supply in the second-hard market, caused by the number of potential vendors opting to ‘wait out’ the recession, this could lead to a real shortage of properties for sale next year.

‘Developers who opt to move now may be in the position of being able to sell into an undersupplied market next year. However, they need to be very cautious, opting to deliver in-demand family housing into those areas with resilient housing markets. Elsewhere, a greater number of forced sales could undermine this strategy,’ said Jon Neale, head of development research at Knight Frank.

The property consultants have noticed a growing interest from residential developers and housebuilders for well located locations. This is in complete contrast to the last quarter of 2008 where there seemed to be little appetite for any form of speculative land acquisition.

But the report suggests that, given the current constraints in the market, it will be difficult for the required delivery levels to be achieved unless new models are found for regeneration schemes or more Greenfield land is released for development.

The National Institute of Economic and Social Research warned that it is a lack of available homes that is driving up recent prices increases in parts of the UK.

As a result, the think tank expects the house price slump to persist for another two years.

‘The temporary rise in prices is probably the result of limited supply. There has been talk of stabilisation and some recovery in the housing market, but we don’t think this is the case. We only see growth in the housing market returning in 2012,’ it said.

Source: http://www.propertywire.com/

Residential property prices in the UK fell slightly in April putting an end to optimisim that had been created by a small rise in March.

Prices fell 0.4% and the average price of a home is now £151,861 according to the April House Price Index from Nationwide, the country’s larges building society. The price of a house is now 15% less than it was a year ago.

Nationwide had said after the March figures that too much should not be read into the small rise and now it is saying that recent measures announced in the Budget were unlikely to turn things around.

But it said that the extension of the stamp duty threashold might encourage first time buyers and this combined with falling prices should have some kind of effect on the property market.

The building society said the government could have done more to aid the availability of credit. ‘The chancellor announced several measures aimed at boosting the housing market in his Budget,’ said Fionnuala Earley, Nationwide’s chief economist.

‘The scheme for government guarantees for new, high-quality residential mortgage backed securities are welcome and may help to boost the amount of mortgage credit available. However, since the availability of credit is only part of the reason why the housing market is in the doldrums it is unlikely to lead to a swift turnaround in its fortunes,’ she explained.

‘Lenders have already indicated that the availability of credit is less of an issue than it has been, but at the same time expect that the demand for secured lending will fall further. Given the weakness of the economy and the expected further increase in unemployment this comes as no surprise,’ she added.

Earley pointed out that the effects of unemployment would have an effect the property market is very sensitive to income and, as a result, conditions in the labour market are crucial to its performance.

‘That said, the correction in house prices and improved affordability conditions provide a good grounding for the market once domestic and global economic conditions once again become more favourable,’ she concluded.

Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors said the figures were not a surprise.

Source: www.propertywire.com

Residential property prices in the UK increased in March for the first time in 16 months but economists are warning that it is not yet a sign of recovery.

The monthly housing price index published by the Nationwide Building Society showed a 0.9% increase last month, the first since October 2007. The price of an average home increased above £150,000.

But economist said the figure should not be taken as a sign that the UK property market is one the road to recovery. Colin Ellis, economist at Daiwa Securities described the reading as likely to be a blip. ‘Even if these glimmers of hope continue to build, households still need access to affordable credit before a sustainable recovery can ensue,’ he explained.

‘It is still too soon to say that this will be the beginning of sustained house price rises and a reflection of a wholesale return of confidence to the market,’ she added.

Abstract from source: www.propertywire.co

Six million property owners in the UK fear their home could end up being repossessed while millions more are anxious that they will end up in a negative equity situation this year, research shows.

A report from consumer watchdog Which? Indicates that almost two thirds of people fear either they or their partner could lose their job during the current recession and more than four in ten are anxious this could make them unable to cover their mortgage.

Meanwhile, 4.2 million people are worried that they could end up in negative equity, almost a quarter of all those who have mortgages and 73% feel the government should be doing more to help them out.

‘It’s dreadful that six million people fear losing the roof over their heads,’ said Which? personal finance campaigner Doug Taylor.

‘With people spending sleepless nights worrying about job losses and repossessions, the industry needs to demonstrate that it wants to win back the trust of the British public by fully embracing government initiatives,’ he added.

The Which? Report calls for a statutory ban on 100% mortgages after its research found that three quarters of people want them banned. It also wants robust protection against people losing their homes because of unsecured debt and for the government to force lenders to become part of the Homeowner Mortgage Support Scheme if they fail to join voluntarily.

Figures from the Council of Mortgage Lenders predict as many as 75,000 repossessions in the UK this year although this has been described by others as optimistic. According to the Financial Services Authority 2.5 million people will end up in negative equity by the end of this year.

Source: www.propertywire.com

Buyer interest in the UK’s property market is increasing across the country with London and the south of England leading the way, according to the Royal Institution of Chartered Surveyors’ (RICS) UK housing market survey.

Buyer enthusiasm which began growing in January continued to grow in February with interest in London at a high not seen for more than two years. This means that interest in the property market has now increased for four consecutive months and reflects both the drop in asking prices and continued interest rate cuts, according to RICS.

As house prices fall, those with finance are looking to pick up bargains. However, this pent up demand has not yet translated into sales. The average number of transactions per agency over the last three months is now at 9.5, a slight drop from 9.8 in November, and the lowest figure since the survey began in 1978.

The balance of surveyors reporting house price falls increased slightly in February with 78.3% more chartered surveyors indicating a fall than rise in house prices, from 76.6% in January.

Family homes remain in demand but flats are proving harder to sell in many areas as first-time buyers are struggling to gain a foothold on the property ladder. Despite depressing repossessions data, the net balance of surveyors reporting new instructions to sell remains in negative territory indicating that supply is very tight. In the current market, a lack of mortgage finance and weak economic conditions are restricting the ability of many to consider the option of entering the market.

However, surveyors remain optimistic that sales will pick up in the coming months as 11% more chartered surveyors expect sales to increase in the coming three months than in January.

Source: www.property-investor-news.com

As massive increase in complaints against property lettings agents in the last year is expected to continue as those who can’t sell put them out to rent instead.

The latest figures from Christopher Hamer, the Ombudsman for Estate Agents, shows a massive 200% annual increase in letting related complaints.

It highlights the need for the public to be acutely aware of rapid changes in the property letting industry, Hamer says in his latest report to the industry.

‘Lettings agents still only join the OEA on a voluntary basis and it is therefore satisfying to see so many firms opening up access to my scheme for their customers. Those firms will be operating in accordance with the standards laid down in the OEA’s Code of Practice,’ he added.

‘The Ombudsman’s report illustrates a dangerous phenomenon that should be of concern to anyone letting, or thinking of letting their property. As properties fail to sell, we have seen a sizeable increase in the number of new, and sometimes reluctant, landlords entering the market,’ said Ian Wilson, Managing Director of Martin & Co.

‘These are the very people who need protecting from the unscrupulous, uneducated or inexperienced letting agent who claims to be able to represent their best interests,’ there is also a corresponding increase in the number of estate agents entering the lettings arena as a way of bolstering their dwindling sales revenues and this has potentially disastrous consequences. Not only is the continual service role of the letting agent surprisingly different to the quick fix function of an estate agent, but there are also over 100 pieces of letting related legislation in which to be conversant.

Source: www.propertywire.com

House prices in the UK are set to decline on average 13-15% during 2009, according to Jones Lang LaSalle’s latest Residential Market Forecast, with the greatest falls expected in London.

The forecast also predicts that prices will fall by a further 1-3% in 2010, with the bottom of the market due to be Q3 or Q4 of that year before recovering by 4-6% in 2011. During 2012 and 2013 Jones Lang LaSalle expects growth to accelerate by a further 8-10%, while peak Q3 2007 levels will not recover until the end of 2015.

James Thomas, Head of Jones Lang LaSalle’s Residential Investment team, commented: “There are however some signs that the market is improving, with the Halifax reporting that prices rose in January and with the RICS claiming that buyer enquiries are increasing. The cut in interest rates and the consequential benefit for affordability will also have played their part in improving perceived market conditions.

However we do not believe these traits will be sustained or sufficiently outweigh the increasing burden of higher unemployment, the greater financial caution by consumers, the difficulties in borrowing and the inevitable increase in housing availability.

During 2009 prime central London prices are expected to be hit sharply with declines of between 16-20%. The first half of the year will prove particularly weak as annual price falls approach 25%, however declines will start to ease towards the end of the year. Greater London witnessed among the highest falls in price across the UK during Q4 2008 (6% compared to the 5.1% average) and they will continue to decline faster during 2009, with annual falls of up to 17%. However, during 2010 house prices will start to rise again from Q3 in both prime central and greater London, and by the year end could increase by 2%.

James Thomas concluded: “We had already built in a very weak housing market in 2009 but the deeper recession this year than previously anticipated does not imply that the housing market will be overly sensitive and fall at an even faster rate. We maintain our view that the housing market’s biggest hit will have been 2008 rather than 2009, both in terms of price falls and turnover. However, we still expect 2009 to be a very poor and troublesome one for the UK housing market. On a more positive note, the three monthly trend in house price falls has already begun to ease and when this becomes a more established trend over the next few months it should signal that the bottom of the market is in sight.”
Source www.propertywire.com

Detectives are looking at cases involving thousands of investors losing millions of pounds in alleged property frauds in the UK and overseas.
Many investigations are examining off-plan buy-to-let frauds involving hundreds of properties in Leeds, Cardiff, Nottingham, Derby, Liverpool, Hull and London.
Already this month five directors of Gateshead based PPP Ltd (Practical Property Portfolios Ltd) and sister company Napeer (Holdings) Ltd have pleaded guilty to fraudulent trading charges.
Newcastle Crown Court heard the companies were wound up after £65 million of investors’ money was lost. PPP sold 4,000 residential properties to 1,750 investors for £80 million. Sentencing will be in March.
Investors paid in £25,000 fees for property in ‘up and coming’ areas in the northeast with a rent guarantee.
The defendants misled investors in almost every material respect. said the prosecution.
North Yorkshire Police are planning more arrests over an alleged £2m international property fraud involving York-based Challenor Property Developments Ltd after arresting and bailing four people on suspicion of conspiracy to defraud and money laundering offences.
Inquiries concerning Challenor are underway in the USA and Spain.

Source: http://www.overseaspropertymall.com/

As the woes of the property markets in the US, UK and Dubai continue to dominate many discussions it has gone quite quiet on emerging markets like Brazil.
Just a year ago Brazil was one of the most talked about property markets in the world and it is not unreasonable to wonder what is happening there now.
But there is not much information out there. There are general noises coming from real estate agents that prices are still moving in an upward direction but little hard facts. It is hard to find out what is really going on.
What little information there is on the property forums this week is sparse and it is clear that what is happening varies from location to location? For example, on the propertycommuity.com forum some people report that the economic downturn is having no impact while others are seeing a quietening in the market.
North East Brazil seems to be relatively unscathed but other parts of the country are not doing as well, according to reports on the forum. There are also warnings about violence in Rio but other places are described as charming and welcoming.
But when it comes to opportunities London might be one place worth a look. Recently analysts have been predicting that prices in London are reaching bottom and there is evidence on the landlordzone.co.uk forum of bargains if you take the time to hunt for them.

http://www.propertywire.com