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Posts Tagged ‘House prices’

Snooping around: Rural, urban or renovation

Monday, July 27th, 2009

From the canals of London to a gated enclave in Portugal's Algarve

Writing home: Properties with literary connections

Monday, July 27th, 2009

Fancy a house with a literary past? Huma Qureshi opens the book on some inspiring properties

Trading up, trading down

Monday, July 27th, 2009

From the raw beauty of the Cairngorms to the quiet reaches of Cornwall

House prices steady in ‘fragile’ market

Monday, July 27th, 2009

The average price of a house in England and Wales remained steady for the third month in a row in July but recovery could still be some way off, according to a survey out today.

In its monthly national housing survey, Hometrack, the property intelligence group, said that while there has been no growth in headline prices over the past three months, the number of sellers achieving their asking price has continued to grow. It rose to 91.5% in July from a low of 88.3% in January.

Average house prices have fallen 7.7% over the past 12 months. The cheapest area in which to buy is the north-east, where the average price is £100,600. The most expensive area is Greater London, where properties cost £274,500 on average.

Richard Donnell, director of research at Hometrack, said: "A lack of mortgage finance, low buyer confidence and fears of unemployment are being offset by increased demand, a pick-up in sales and a scarcity of housing for sale."

However, he said that even though the improvement in market activity might well be real, it was "off a very low base. The housing market remains in a fragile state." It could easily be undermined, he added, by an increase in the supply of homes for sale.

Hometrack found that agents and surveyors reported that house prices increased across 10% of postcodes in July, mainly in southern England. In the north of the country, agents reported "difficult" market conditions characterised by more stock but weak demand.

The group also found that it took longer to sell a house in the north – an average of more than 10 weeks, compared with 5.8 in London.

guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds

How surveyors have failed us

Friday, July 24th, 2009

Lenders, not buyers, are the true arbiters of how much your property is worth

What does a valuation surveyor actually do? Don't get me wrong, some of my best friends are surveyors. I'm not anti-surveyor, but ...

A report from the Bank of England this week said lenders are struggling to value homes in this market, leading to the break-up and collapse of chains.

How different from the halcyon days of two years ago when the job of a valuation surveyor was little more than establishing the "comparables". A tough task indeed; drop in for a chat at an estate agency and find out how much similar properties have gone for. If that was too strenuous, there was always the actual sold price at the online Land Registry. Indeed, why employ humans? Many lenders found it simpler and cheaper to use "automated valuation models" during the boom. Yet the home buyer still got an inflated bill for a valuation, around £350 on a £200,000 purchase.

With so few sales, it's now impossible to establish comparables. How much is a house worth on a street where nothing has sold for a year? Valuation surveyors are working twice as hard on half the business. Lenders want valuations pushed down, fearful of further price falls. Chains are falling apart after a low valuation prevents buyers obtaining a big-enough mortgage to go ahead.

The Royal Institution of Chartered Surveyors should be taking a long, hard look at itself. How truly professional is the work of its members? Who was valuing buy-to-let flats at such absurdly inflated prices? How does a valuation surveyor get it so wrong? And what sort of action should a professional body take against those members who have so discredited themselves?

The skills needed for the structural element of a home survey will always be essential. But the valuation bit? Clearly the profession was hypnotised into believing markets rise in a straight line.Valuers live by the maxim that the price of a property is the amount someone is willing to pay. This is nonsense: the true price is the amount someone is willing to lend you to buy it.

Value is not in the eye of the beholder, it lies in the spreadsheet of a lender.

Shoots first, ask questions later

It's one of Britain's few growth markets: the green shoots industry. June's figures from the Council of Mortgage Lenders were issued on Tuesday. Within minutes, I'd heard from propertyfinder.com: "Demand from movers and first-time buyers is growing fast; the National Association of Estate Agents: "There are plenty of prospective homebuyers out there"; LSL Property Services (who?): "Gloom is starting to lift"; Marsh & Parsons (again, who?): "Competition is fierce and reflected in rising asking prices". The list could go on and on, because so many people are paid to talk up the property market, come rain or shine.

However, tucked in between these comments was a somewhat more considered analysis from Neil Woodford, of Invesco Perpetual.

Green-shooters look away now. Woodford, who runs more money on behalf of small investors than anyone, says a recovery in the economy could be three to four years away. The consumer boom and the housing market bubble were built on easy access to credit, and created "massive imbalances", he says.

His conclusion? That just as they took a long time to build, they will take a long time to address.

Click on a crook

Last week, as part of a little experiment, this column advised readers to click on the Google "sponsored link" of a dodgy website, www.VFestival2009.org/Tickets, claiming to offer V Festival tickets. Fraud specialist Reg Walker said it cost the crooks running such sites an average of £2.50 each time someone clicks on a link. Our logic was that by constantly clicking on those Google links, we'd make it hideously expensive for fraudsters to fleece us.

It's clear a number of people did indeed click. And the good news is that, for now, this particular site is no more. Walker says it has been removed from the net "on suspicion of fraud". This brings the number of scam ticket sites removed by the Metropolitan Police to around 150 in the last 18 months.

The problem is the people behind these fraudulent sites often simply relaunch with slightly different names. I wonder if the VFestival2009.org people paid their Google bill before the plug was pulled? If Google has been left out of pocket, perhaps it will encourage the search engine not to accept the business of such people in the first place …

guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds

How the surveying profession failed

Friday, July 24th, 2009

Life was easy for surveyors when properties were flying off estate agents' books, but the housing market downturn has raised questions about their role

Quite what does a valuation surveyor actually do? Don't get me wrong, some of my best friends are surveyors. I'm not anti-surveyor, but ...

A report from the Bank of England this week said lenders are struggling to value homes in the current market, causing delays which are leading to the break-up and collapse of chains.

How different from the halcyon days two years ago when the job of a valuation surveyor was little more than establishing the "comparables". A tough task indeed: dropping in for a chat at a local estate agency, and finding out what similar properties have gone for. If that was too strenuous, there was always the Land Registry's website, holdings details of actual sale prices. Indeed, why even employ humans? Many lenders found it was simpler and cheaper to use "automated valuation models" during the boom years.

Yet the homebuyer still got stiffed with an steep bill for a valuation, typically around £350 on a £200,000 purchase (although often waived for remortgages).

Today the automated valuation models are close to breaking down. With so few sales, it's impossible to establish comparables. How much is a house worth on a street where there has not been a sale for a year? Valuation surveyors are having to work twice as hard on half the amount of business. Lenders want valuations pushed down, fearful of further falls in house prices. Buyers are in chains which fall apart after a low valuation prevents them from obtaining a big enough mortgage to go ahead.

The Royal Institution of Chartered Surveyors should be taking a long hard look at itself. How truly "professional" is the work of its members? Who was valuing buy-to-let flats at such absurdly inflated prices? How does a valuation surveyor get it so wrong? And what sort of action should a professional body take against members who have so discredited themselves?

The professional skills needed for the structural element of a home survey will always be essential. But the valuation bit? Clearly the profession failed, hypnotised like the rest of the country into believing markets rise in a straight line upwards.

Valuers live by the maxim that the price of a property is the amount that someone is willing to pay. But this has turned out to be nonsense. In truth, the price of a property is the amount someone is willing to lend you to buy it. Value is not in the eye of the beholder, it's in the spreadsheet of a lender.

guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds

Credit crunch reaches world’s most expensive streets

Wednesday, July 22nd, 2009

The global financial crisis has squeezed property prices, but how has it affected those at the very top?

Avenue Princesse Grace in Monaco is the most expensive street in the world, with each square metre in an apartment setting you back £73,000 – or about the same as a 70-square-metre apartment on the seafront in Hastings, according to Dow Jones' Wealth Bulletin.

But the palm-lined street, named after the Hollywood star Grace Kelly and popular with Russian oligarchs, is suffering from "la crise du credit" like everywhere else. The bulletin shows top prices paid for apartments, are down by 37% from 2008's peak of £116,000 a square metre.

Overall, prices paid for prime residential property in the world's fanciest locations have fallen by 12% over the past year, although Europe fell less sharply than the US and Russia.

Via Suvretta in the Swiss ski resort of St Moritz was the only street on the list where prices for top properties have risen since 2008. Prices are up by 18% to around £27,500 a square metre.

The world's second priciest street, the Chemin de Saint-Hospice, is a 20-minute drive along the coast from Monaco, snaking through on Cap Ferrat. It numbers just 15 houses, commanding beautiful Mediterranean views.

According to Wealth Bulletin, local estate agents say there is one property for sale on the street, but it is being sold privately and its price a closely guarded secret. It estimates that property on the street goes for an average of £61,000 a square metre.

New York's Fifth Avenue pips London's Kensington Palace Gardens to third place in the survey, with apartments selling for around £44,000 a square metre. Although a 400 sq/m apartment overlooking Central Park on the Upper East Side of Fifth Avenue sold for $29m in June, local agents say the market has come off the boil, and remains affected by a lack of supply

Fourth-placed Kensington Palace Gardens is Britain's most exclusive address, best-known as London's embassy row, including the Russian delegation. Prices in the street are estimated to have fallen by 15%-20% over the past year.

The world's top 10

1. Avenue Princesse Grace, Monaco, £73,000 per sq/m

2. Chemin de Saint-Hospice, Cap Ferrat, South of France, £61,000 per sq/m

3. Fifth Avenue, New York, £44,000 per sq/m

4. Kensington Palace Gardens, London, £40,000 per sq/m

5. Avenue Montaigne, Paris, £33,000 per sq/m

6. Via Suvretta, St Moritz, Switzerland, £27,500 per sq/m

7. Via Romazzino, Porto Cervo, Sardinia, £26,000 per sq/m

8. Severn Road, The Peak, Hong Kong, £24,500 per sq/m

9. Ostozhenka Street, Moscow, £21,000 per sq/m

10. Wolseley Road, Point Piper, Australia, £17,000 per sq/m

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