The monthly Nationwide property report shows that UK house prices rose by 0.7% in March to hit an average of £164,519. This takes UK house prices back to the levels seen in January after the fall of 0.8% in February, which spooked many people and led to concerns about the short to medium term direction of the UK property market. So does this increase in March mean the end of any potential downturn?
Lawyers around the UK have voiced their concerns about the government's recent property stamp duty holiday announcement which will see first-time buyers exempt from stamp duty on the purchase of homes up to a value of £250,000. As we covered in one of our earlier articles, HM Revenue and Customs (HMRC) has laid out strict regulations regarding who can apply for exemption but there is even confusion and disappointment in these!
The UK government today announced stamp duty relief for first-time buyers acquiring properties up to a value of £250,000. However, before the ink is even dry on Alistair Darling budget report the move has come in for significant criticism due in the main to the government's definition of a first-time buyer.
Today's budget saw Alistair Darling, the Chancellor the Exchequer, announce a doubling of the stamp duty threshold from £125,000-£250,000 for 2010 and 2011. This is a welcome move and is forecast to impact upon property purchases by nine out of ten first-time buyers in the UK although there is a sting in the tail for those with properties worth in excess of £1 million.
It has been revealed that the UK commercial property sector recovery is predominantly being financed by German banks who are now offering up to 60% of the required capital for the sector. The number of German banks looking to arrange large long-term loans to the UK commercial property sector has increased from 18 to 21 during the past six months and indeed it seems that the German financial companies have taken a more long-term approach to the UK sector than their UK counterparts.
The Royal Institute of Chartered Surveyors has today confirmed that UK rents are set to increase in the short to medium term as the number of properties coming onto the rental market continues to decline. For the second quarter in a row we have seen a reduction in homes available for rent across the UK as those who were struggling prior to the recent economic upturn, and forced to rent out their properties, are now placing them back on the market for sale.
Property website giant Rightmove has today confirmed that UK property price growth is starting to falter, falling from 6.1% annual growth in February to 5.3%. This would appear to confirm recent concerns regarding the UK property market and the significant increase in property purchases prior to the end of the stamp duty concession. It is unclear whether extreme weather conditions have also impacted upon the UK property market in the short-term but we are at something of a crossroads regarding UK property prices.
Over the last few days there have been signs that the UK property market is softening and indeed many experts believe it is on the verge of falling back. A reduction in mortgage funding, fewer buyers and signs that prices are starting to soften could literally turn the market on a sixpence over the next few weeks. This would be a nightmare scenario for Gordon Brown who is currently enjoying a surge in the polls as we approach the next election.
Over the last two years there have been a number of highly successful and very expensive fiscal programs to induce growth into the UK economy. One such program was the stamp duty break which ended in December 2009 and which had a massive impact upon the UK property market. Such was the impact that many property purchases were rushed through in December to take advantage of the reduced costs and January mortgage lending figures collapsed by 49% compared to December.
Manchester City football club, currently under the ownership of Sheikh Mansour, has today announced plans for a £1 billion development of the land around the football club stadium. This is part of a wider development in the Manchester area with co-operation from the Manchester City Council.
