Weekly Summary: 12th May 2023

DATA: Halifax reported UK house prices rose 0.1% in year to April 2023

They reported(PDF) a 0.3% monthly fall, leaving prices relatively unchanged over the year.

DATA: ONS estimated monthly GDP fell 0.3% in March 2023

This left GDP just 0.3% higher than the same month last year and 0.5% lower than the pre-pandemic peak in January 2020.

DATA: Bank of England reported further falls in quoted mortgage rates

The average quoted five year fixed rate mortgage at 75% loan-to-value fell to 4.17% in April (4.27% previously). However, the average revert-to-rate increased to 7.41%.

DATA: DLUHC reported falls in Help to Buy equity loan completions

The data for Q4 2022 shows the number of completions fell 8% compared to the same quarter in 2021. However, the number of completions in London increased by 54% over the period.

DATA: HM Treasury published mortgage guarantee scheme statistics

The release covers the period up to the end of 2022 and shows the scheme has covered “1.9% of all residential mortgage completions in the UK from the beginning of April 2021 to the end of December 2022”. The success of this scheme is not measured in its actual numbers but in the availability of higher loan-to-value mortgage products.

DATA: DLUHC published leasehold dwellings estimates for 2021/22

The estimates for England report 4.98 million leasehold dwellings, 20% of the housing stock. 70% of these homes are flats with the remaining 30% houses.

DATA: ONS published 2021 Census data on families

They also released analysis on adults living with their parents, showing a 13.6% increase since the 2011 Census.

POLICY: Bank of England increased bank rate to 4.5%

The Monetary Policy Report suggests: “Confidence in the residential housing market had recovered a little, but it remained depressed in the commercial property market.

REPORT(PDF): RICS published April residential market survey

They report: “Feedback on new buyer enquiries and agreed sales remains relatively downbeat” and “”National house price indicator still in negative territory although marginally less so than in prior months”.

REPORT: House of Commons Library briefing on SME housebuilders

The report provides a summary of small and medium-sized housebuilders. Unfortunately there is limited data available on their output and historic statistics published by NHBC are compromised by their market share issues.

REPORT: Savills reported on the purpose built student housing market

They report “Global investors continue to target UK PBSA, with a shortage of supply and rising student numbers resulting in strong rental performance”.

REPORT: TwentyCi reported on the state of the housing market

Unfortunately the report does not give any useful trend data and, as the largest region, the South East will almost always have the most market activity.

CORPORATE: Grainger published half year financial results

They report “6.9% like-for-like PRS rental growth” in H1 with 8.2% on new lets and 6.1% on renewals. They also report “98.5% occupancy in our PRS portfolio at the end of March”.

Chart of the Week

Homes England has recently published detailed data on the repayment of Help to Buy equity loans including the original and repaid value (RFI4175). The data finally allows us to understand how consumers have fared when using the scheme. The chart below shows the percentage return on the original equity loan (repaid value/original value – 1). Although there is no regional data, we can use the equity loan share (>20%) to isolate the London scheme. As the chart shows, those loans with 20% equity loan share or less have generally seen a positive return, though perhaps less than underlying house price inflation. However, the majority of London loans repaid have seen a fall in value. There are some with very large percentage falls reflecting the impact of the cladding crisis, but the majority have seen falls in value of up to 10%. This probably reflects both the lack of price inflation for flats in London over recent years and the erosion of the new build premium.

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